Subway Switches to Pepsi Drinks in New Deal

Subway Switches to Pepsi Drinks in New Deal

News by Roberto Orosa
Published: March 20, 2024

PepsiCo Inc. has just landed an exclusive deal to supply drinks across all Subway outlets in the United States, edging out Coca-Cola as the sandwich chain's official beverage partner.

The newly inked 10-year agreement will replace Coca-Cola drinks like Vitamin Water, Sprite and Diet Coke with PepsiCo brands Mountain Dew, Gatorade and Tropicana, among others, starting January 2025. 

"The partnership with PepsiCo is an exciting milestone in our journey to become America's favorite place to eat, drink and work," Doug Fry, president of Subway North America, shared in a press release.

Coca-Cola, which has served Subway's U.S. outlets for nearly two decades, expressed commitment to continue serving Subway through the remainder of the year.

Beyond the Drinks

Subway, boasting around 20,000 restaurants in the U.S. and nearly 37,000 globally, also revealed the extension of its agreement with Frito-Lay, a unit of PepsiCo, ensuring the provision of chips and snacks until 2030.

"Together, we're elevating the consumer experience with dynamic beverage and snack offerings — including those that appeal to a broad spectrum of consumers — bringing new flavors to Subway fans in a powerful way," PepsiCo Global Foodservice President Anne Fink said.

On top of its new beverage deal with PepsiCo, Subway is also extending its snack agreement with Lay's.
Subway Sandwich Meal Paired With Lay's Chips and Pepsi | Source: Subway

"It is a win-win for everyone, as it brings a delicious suite of beverage and snack choices to our guests, driving additional consideration of these menu items, while also providing cost-effective, streamlined solutions to our franchisees," Fry added.

The beverage deal comes amid Subway's impending acquisition by Roark Capital Group, a private equity firm based in Atlanta.

The acquisition, valued at nearly $10 billion, is currently under investigation by the Federal Trade Commission, as reported by Politico.

In a separate development, Coca-Cola is set to expand its business by securing distribution rights in two prominent Cincinnati-based chili chains, Skyline Chili and Gold Star.

Both chains announced their decision to switch from Pepsi to Coca-Cola products, generating considerable attention from fans of the restaurants.

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Editing by Katherine 'Makkie' Maclang

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