9

There are several claims on the internet that for a brief time PepsiCo owned the sixth largest military force in the world. You can read about it, e.g., at Wikipedia.

This seems quite fishy to me, so I wonder how anyone came to this conclusion.

From a source upstream of Wikipedia:

So, in the spring of 1989, Pepsi and the Soviet Union signed a remarkable deal. Pepsi became the middleman for 17 old submarines and three warships, including a frigate, a cruiser, and a destroyer, which the company sold for scrap. Pepsi also bought new Soviet oil tankers and leased them out or sold them in partnership with a Norwegian company.

  • 4
    In the Wikipedia article there is a footnote that links to an article about the issue. Have you read it to see if it dispels your doubts? You really should use that article and not the Wikipedia as the basis for the question, since it will explain the affirmation more in depth. – SJuan76 Aug 28 '18 at 9:35
  • 1
    I've read several of these articles and they don't provide any proof, except for mentioning the claim. I've linked to Wikipedia so that everyone can see that this claim made its way that far. From there, anyone can click on the footnote. – domotorp Aug 28 '18 at 9:37
  • 7
    Did the vessels come with armaments, stores and crews? If not, it's difficult to view them as a "military force". – Steve Bird Aug 28 '18 at 9:44
  • 3
    When I was a squid, we said Pepsi was the fourth largest submarine navy.. much more believable than sixth largest military. – Mark C. Wallace Aug 28 '18 at 11:26
  • 8
    I think this is just a case of a Wikipedia editor getting a source very wrong. The article cited in Wikipedia doesn't make the claim that they were the 6th largest military, and being the middleman in a deal to sell old warships for scrap doesn't really mean they had a functioning navy, let alone a military. Also, 17 submarines and three warships is far from the 6th largest navy now, and I doubt it would have been in 1990 either(6th largest submarine force might be accurate though). – Giter Aug 28 '18 at 12:09
17

No, but for a short while in 1989 they were the owners of 17 ex-military submarines.

In 2000 China had about 65 submarines. In 1990 Britain had about 29 submarines (about ten now). Currently Japan has the sixth largest fleet of submarines with seventeen submarines.

So it is plausible that in 1989 PepsiCo briefly owned the sixth largest "fleet" of military submarines - though it seems certain they were demilitarised. It seems likely they were not in usable condition and were towed by surface tugs to a scrapyard which could pay in US dollars. So the assertion is somewhat poetic rather than factual.

New York Times, 1989: Soviets Buy American

Pepsico recently bought from the Soviets 17 submarines (for a measly $150,000 each), a cruiser, a frigate and a destroyer. They are being resold for scrap.

...

These peculiar ventures for a soft drink company are a necessary way for it to do business with Moscow. Pepsi has 21 plants in the Soviet Union and wants to open 26 more. The problem, as in most deals with the Soviets, is how to get the money out.

So really it has more to do with the problems of converting currency of the the Soviet Union into hard currency, not to do with PepsiCo's naval ambitions!

|improve this answer|||||
-3

It all started in 1959 at an expedition the United States did in Moscow to showcase life in a capitalist world, and the company Pepsi was there. A Pepsi executive, Donald M. Kendall, was a good friend of Nixon, vice president at the time, and when Nikita Khrushchev, the leader of the Soviet Union at the time, got in a debate with Nixon over soviet Satellite states Kendall offered both of them a cup of Pepsi. Khrushchev absolutely loved the drink, and six years later, Kendall was made CEO of Pepsi.

In 1975 he was able to start selling Pepsi inside of the Soviet Union and was able to lock Coca-Cola out of the Soviet Union. There was only one problem, the Soviet Ruble only worked inside the Soviet Union and had no worth outside the Soviet Union. What the Soviet government did have to barter however was lots and lots of Vodka. The Soviets traded Stolichnaya vodka to Pepsi in exchange for Pepsi products to be distributed throughout the Soviet Union. However, in response to the Soviet invasion of Afghanistan, the United States held a boycott against Soviet products, including the Vodka that Pepsi was trading. Because of this, the Soviets had no way of paying for their Pepsi with products, so they had to come to a surprising deal.

They traded 17 old submarines, a frigate, and cruiser, and a destroyer. At the time, this was the sixth largest fleet of ships, unfortunately, Pepsi immediately sent the ships to Norway to be scrapped. They also obtained a large fleet of Soviet oil tankers which they sold to obtain more money. So for a short time, it is true the Pepsi had the sixth largest navy in the world, regardless of personal or ammunition. In conclusion, Pepsi, for a short time, owned the sixth largest fleet in the world.

My source: https://www.atlasobscura.com/articles/soviet-union-pepsi-ships

|improve this answer|||||
  • 5
    Interesting story but, aside from your last sentence (which should be promptly deleted as it is completely out of place and also offensive to some), this needs sources and paragraphing. – Lars Bosteen Mar 3 at 2:48
  • Legalistically the down votes may be correct, but I thought this background was fascinating, and is appreciated. These kinds of details are a reason I find history interesting in the first place. – UnconditionallyReinstateMonica Mar 3 at 13:37

Your Answer

By clicking “Post Your Answer”, you agree to our terms of service, privacy policy and cookie policy

Not the answer you're looking for? Browse other questions tagged or ask your own question.