PepsiCo’s renewed beverage contract with Taco Bell secures the supplier a place at the Yum Brands chain through 2036, even as sister chain KFC prepares to replace Pepsi with Coca-Cola in the United States.
The company announced the renewal Oct. 22, one week after KFC disclosed its U.S. supplier change. A PepsiCo spokesperson told Reuters that the Taco Bell agreement lasts 10 years and that the renewed arrangements also cover KFC restaurants outside the United States. CNBC reported that Taco Bell locations in Canada, the United Kingdom, Ireland and Thailand are included.
KFC U.S. President Catherine Tan-Gillespie wrote in an Oct. 15 memo obtained by CNBC that Pepsi would remain an important partner for Yum Brands and KFC’s international operations. At Taco Bell, Pepsi products are linked to menu items including Mountain Dew Baja Blast and Doritos Locos Tacos, CNBC reported; the outlet said those offerings have been exclusive to the chain.
KFC plans to begin replacing its U.S. beverage lineup in January 2027; it expects every restaurant in the country to offer Coca-Cola by spring 2027, according to the company and EconoTimes’ earlier coverage.
The supplier changes reflect competition for major restaurant contracts. CNBC said beverage-provider switches are unusual among large chains but have happened before, with Coca-Cola and Pepsi competing through perks and other inducements. The outlet characterized Coca-Cola’s KFC agreement as a symbolic win in the companies’ soda rivalry. CNBC traced PepsiCo’s ties with Taco Bell and KFC to its ownership of the restaurant chains before they became a separate public company in 1997.
