Molson Coors brewery workers strike in Texas

Workers at a Molson Coors brewery in Fort Worth, Texas, began a strike this week after contract negotiations with the beverage giant fell through.

The 420 workers — represented by the local Fort Worth chapter of the Teamsters union — help produce, bottle and package beverages at the only facility serving the Western U.S., the union said in a press release. Employees are looking for pay raises that account for inflation, along with more access to health care and retirement benefits as part of its new three-year contract, according to the Teamsters. Molson Coors, the union claimed, only offered raises of 99 cents an hour in initial negotiations.

Sean M. O’Brien, general manager for the Teamsters, said in a statement Molson Coors does not care if its workers can’t afford basic needs and health care.

“Executives shamelessly brag to investors about the company’s incredible growth and historic earnings. Millions go to the CEO, billions go to Wall Street, and a middle finger goes to the workers,” O’Brien said. “We’re not taking the disrespect, we’re not accepting the crumbs, and we’re not making concessions. The Teamsters are taking this fight to the streets, and we will hold the line until our members get what they have earned.”

In a statement to CNN, Molson Coors said it built up inventory ahead of the strike and thus has more capacity at five other facilities.

“While we respect the union’s right to strike, we have strong contingency plans and are well equipped to ensure consumers will be able to buy their favorite Molson Coors products,” the company told CNN.

The strike is halting production for Molson Coors at one of its biggest plants, which produces drinks like Coors Light, Pabst Blue Ribbon and Yuengling. In its earnings call last week, Molson Coors CEO Gavin Hattersley told investors the company’s increased market share in the beer space was “permanent,” pointing to 9.3% net sales growth in its most recent quarter.

But the Fort Worth strike may not be the only picketing organized by the Teamsters against a beer giant. The union said earlier this month workers at AB InBev plants may also go on strike after its contract expires on Thursday, Feb. 29, when the company is set to report earnings.

Wall Street analysts are taking notice of the labor issues in the beer space. In a note to investors, Neil Churchill of HSBC Global Research said Molson Coors may not be the biggest company the union is targeting, as labor groups often approach a wider industry strike incrementally. A larger strike against AB InBev could impact 5,000 workers, versus the 420 at Molson Coors’ plant, he said.

“We believe that [AB InBev] could rationalize its plant network with the possible closure of 2-3 breweries in order to match the reality of its current volume output, which may be a major source of tension beyond hourly wages and benefits,” Churchill said. “It looks like a complicated negotiation.”