Under the changes in Venezuela, are the two major Cola giants ushered in business opportunities?

The Zhitong Finance App learned that Venezuela has always been the focus of attention of the two major beverage giants, Pepsi (PEP.US) and Coca Cola (KO.US), because the country has rich revenue from petroleum, a large urban consumer base, and far higher soft drink consumption than other South American and Central American countries. For decades, Venezuela has been one of the most profitable Cola markets in Latin America. It was also the “beach position” for two major brands entering the Latin American market until economic and political turmoil completely disrupted this market.

Pepsi first entered the Venezuelan market in 1940 and established Pepsi as the country's dominant Cola brand for decades through the Cisneros Group, until Cisneros suddenly handed over the bottling business to Coca Cola in 1996. To cope with this sudden change, Pepsi and Empresas Polar, a leading local food and beverage group, established a national beverage joint venture to re-enter the Venezuelan market. The newly formed Pepsi Venezuela Joint Venture is responsible for the production and distribution of Pepsi drinks, and also owns Venezuelan snack and food businesses, such as PepsiCo Alimentos S.C.A., a food company that produces chips and other packaged foods. This structure means that Pepsi's core bottling and marketing channel business is managed by a locally held Pepsi-Polar joint venture. Pepsi operates as the brand owner and minority partner rather than through a wholly-owned subsidiary of Pepsi Cola.

On the other hand, Coca Cola is still operating in Venezuela through a local bottler associated with Coca-Cola FEMSA, although the business has been removed from the consolidated statements and the operating environment is limited and risky. Coca-Cola FEMSA is listed as an investment and is called “KOF Venezuela” in the company's financial reports.

With external intervention and the beginning of a new regime transition in early 2026, the Venezuelan market showed an opportunity for reconstruction. If international sanctions are further relaxed and the currency stabilizes, the two companies are expected to usher in a window of supply chain modernization and strategic restart. America's actions against Venezuelan President Nicolás Maduro and America's growing involvement in Venezuela may create conditions for Pepsi (PEP) and Coca Cola (KO) to make sufficient improvements in supply chain management, factory modernization, and monetary stability in the medium term to readjust their strategy in the once critical Latin American market.

However, in the face of still high inflation expectations and broken distribution networks, the main task in 2026 is still to assess political risks and gradually restore basic production capacity. Real market recovery still depends on fundamental improvements in the macroeconomic environment. The political turmoil and regime change in Venezuela have caused Coca Cola and Pepsi to face serious business challenges. A long period of hyperinflation, scarcity of raw materials (such as sugar), and aging infrastructure forced the two companies to interrupt production several times and adjust financial statements to avoid risks. Although Pepsi has shown strong operational resilience through its joint venture model with the local giant Polar Group, both giants have switched from pursuing profit to crisis management in the midst of turmoil, and their market share has been severely suppressed by extreme contraction in consumption power.