Taco Bell and Pepsi have renewed their partnership for another 11 years, according to a Thursday press release, after sister brand KFC’s decision to drop the beverage maker for Coca-Cola raised fears for the future of the Mountain Dew Baja Blast.
The brands have historically collaborated on much of Taco Bell’s menu innovation, including both the Baja Blast and the Doritos Locos Taco, said Anne Fink, PepsiCo’s president, global food away from home.
Together, the chains have built the Baja Blast beverage platform into “a billion-dollar brand with a passionate fan following,” that includes a variety of drinks and other dishes, like a gelato and limited-time pie, per the press release.
PepsiCo and Taco Bell will continue to work together in the U.S. and international markets including the U.K., Canada, Ireland and Thailand, through the end of 2036. The two brands have worked together for over 20 years, according to the press release.
Looking ahead, Taco Bell will try to position itself ahead of “emerging beverage trends across crafted, functional and energy beverages, including energy offerings designed to appeal to Gen Z consumers and unlock new morning and afternoon occasions,” the press release said.
The decision also signals confidence in the continuity of Taco Bell’s menu strategy — which had powered it to years of industry-leading sales performance prior to this summer’s Cyclospora outbreak.
KFC, by contrast, had struggled for years to get sales traction and is in the midst of a major brand overhaul that includes a menu makeover. Both brands were once owned by PepsiCo, until the soft drink firm spun them off as part of Tricon Global Restaurants, which later became Yum Brands. Under Yum, the chains continued to have a supplier relationship with Pepsi, until KFC’s announcement earlier this month that it was moving to Coke.
