PepsiCo, Inc (NASDAQ: PEP) and Boston Beer Company Inc (NYSE: SAM) have teamed up to make a new alcoholic drink -HARD MTN DEW. Boston Beer announced the collaboration on August 10.

HARD MTN DEW is to enter the market at the beginning of 2022. It will have 5% alcohol and will come in three flavors. These flavors are black cherry, original, and watermelon.

Previously a company specializing in non-alcoholic beverages, PepsiCo has been hinting at a change. The CEO of Pepsi Ramon Laguarta told analysts the company was considering dabbling in alcoholic beverages.

Boston Beer Company and Pepsi will be playing different roles on the new product

Boston Beer will take care of the production of the new beverage. Pepsi, on the other hand, will deal with marketing and distribution. The company plans to develop a new entity that will deliver, sell and merchandise the beverage. It will be sold only to adults of legal age and will be marketed along with other alcoholic drinks.

The CEO and president of Boston Beer, Dave Burwick, say the alliance seeks to bring new experiences consumers crave. He believes the worlds of non-alcoholic and alcoholic beverages are converging, and it is essential to meet the consumer’s needs. The move brings together two iconic brands, each with iconic drinks and vast experience in beverage production, together to make something new.

The CEO of PepsiCo Beverages in North America, Kirk Tanner, says that the alliance brings two industry giants who recognize the changing taste of consumers.

Boston Beer Company collaboration

This partnership is not a first for the Boston Beer Company. They have made a series of collaborations in the past year, including a team-up with Tipsy Scoop, an ice cream company located in New York, to make Hazy-O IPA ice cream with 5% alcohol. In addition, Hazy-O includes the Dogfish Head Hazy-O IPA.

The collaboration comes shortly after reports that its own products are struggling. As a result, the company’s shares have gone down 33% in the last year. Meanwhile, Pepsi’s shares have gone up by 4% in the past year after selling some of its juice brands like Tropicana.