Commentary: Strong 2017 Sales for Duracell Show the Continued Utility of the Alkaline Battery

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Berkshire Hathaway’s battery-maker Duracell, which it acquired from Procter & Gamble in 2016, is proving the continued value of tried and true alkaline batteries.

While much of the focus in the press these days is on lithium-ion and nickel-metal-hydride batteries, and the search for batteries with more exotic chemistries, the trusty alkaline battery, which was first patented by Union Carbide in 1960, has continued to be a big sales winner.

According to reports, Duracell’s third quarter sales rose 6 percent year-to-year from 2016, as the demand for alkaline batteries continues to grow.

Sales of Duracell batteries in the U.S. alone topped $1 billion in 2016, eclipsing its major competitor brands, Eveready and Rayovac, combined sales.

Alkaline Batteries Essential During Disasters

The 2017 hurricane season that devastated the Caribbean, Florida and Houston, Texas, showed that rechargeable batteries are of limited use when the power grid goes off-line for weeks or months. They also have the downside of energy loss when stored long term. Durable alkaline batteries, which have a storage life of over 10 years, have an important place in helping people prepare for and recover from disasters.

It was a point that Duracell was able to make through its own disaster relief teams.

In Puerto Rico, Duracell’s PowerForward teams have been on the ground across the island. Its emergency response teams have given out tens of thousands of batteries, and provide charging stations through their specially outfitted vehicles. The vehicles are delivering more than $1 million worth of batteries, making this the program’s largest deployment to date.

Duracell’s PowerForward fleet consists of five trucks, custom-designed to handle specific disasters, and strategically stationed to get to any U.S. location within 24 hours. Each one is equipped with mobile charging stations and stocked with thousands of Duracell batteries.

In Puerto Rico, Duracell deployed two of its highest capacity vehicles. The Heavy Haulers pull trailers that help them transport over 100,000 AA batteries – more than any other vehicle in the fleet. Normally, one is stationed in San Francisco, California while another is kept in Portsmouth, New Hampshire. These trucks specialize in handling earthquakes, floods, landslides, wildfires, hurricanes and winter storms.

The Battery for Everyday Use

While natural disasters draw attention to the continued usefulness of alkaline batteries, for most of us it is their continued utility for more mundane needs, such as toys, electronic devices, and smoke detectors where their low cost, long storage life, and durability win out.

And Berkshire’s got the sales revenue to prove it.

© 2018 David Mazor

Disclosure: David Mazor is a freelance writer focusing on Berkshire Hathaway. The author is long in Berkshire Hathaway, and this article is not a recommendation on whether to buy or sell the stock. The information contained in this article should not be construed as personalized or individualized investment advice. Past performance is no guarantee of future results.

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