PepsiCo Locks In Taco Bell Partnership Through 2036, Days After Losing KFC to Coca-Cola

PepsiCo has extended its beverage partnership with Taco Bell through 2036, an 11-year renewal that locks in exclusive pouring rights across Taco Bell, Taco Bell Cantina and Live Más Cafe locations nationwide, while PepsiCo also retains international distribution in Canada, the UK, Ireland and Thailand. The deal covers Pepsi, Pepsi Zero Sugar, Mountain Dew and Starry, along with Taco Bell exclusives like Mountain Dew Baja Blast and Baja Midnight.

Timed just after a rival win for Coke

The renewal comes just a week after Coca-Cola secured a major beverage supply agreement with KFC, ending PepsiCo's nearly 40-year relationship with the fried chicken chain in the US. By locking in Taco Bell instead, PepsiCo is protecting what is by far the more lucrative of Yum! Brands' domestic chains: Taco Bell generated about $17 billion in US system-wide sales in 2025, compared with roughly $5 billion for KFC.

The move effectively ring-fences PepsiCo's most valuable quick-service restaurant alliance against further inroads from Coca-Cola, which has been aggressively pursuing beverage contracts across the fast-food industry. For PepsiCo, keeping Taco Bell locked in for over a decade offers a measure of stability in a category where exclusive restaurant partnerships have become an increasingly contested battleground between the two beverage giants.