The maker of Lucky Strike and Dunhill cigarettes aims to save £600 million ($792 million) a year by 2028 in a restructuring that will affect around 20 percent of BAT’s 47,000-member workforce, it said in a statement.
Signage is pictured on the front of the headquarters quarters of British American Tobacco at Temple Place in central London on January 17, 2017.
British American Tobacco announced Monday sweeping job cuts as the cigarette maker axes 5,500 roles globally and outsources another 3,500 to help slash costs.
The maker of Lucky Strike and Dunhill cigarettes aims to save £600 million ($792 million) a year by 2028 in a restructuring that will affect around 20 percent of BAT’s 47,000-member workforce, it said in a statement.
BAT, along with other tobacco majors, faces declining demand for traditional cigarettes and is turning its focus instead to newer categories, including vapes and oral nicotine products.
“We are building a future-ready organisation that is more agile, cost-disciplined and technology-enabled,” said chief executive Tadeu Marroco.
“These changes affect many of our colleagues, and we are focused on supporting them through this transition with care and respect, as we position the business for the future,” he added.
The job cuts span BAT’s global workforce except for the United States, its largest market, where the business is run through its subsidiary Reynolds American.
Shares in the company fell 1.5 per cent on the London stock exchange, where the top-tier FTSE 100 index was trading 0.2 percent lower.
“British American Tobacco is the latest name to ramp up the use of technology to help its business run more smoothly and be able to launch new products faster,” said AJ Bell investment director Russ Mould.
“The scale of cutbacks is a sign of the times, and the trend is worrying for the state of the labour market,” he added.
