British American Tobacco plans to reduce its workforce by approximately 20 percent. The decision is part of an ongoing AI-based reorganization aimed at cutting costs and improving profits in response to stricter regulation and slower new product launches.
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BAT to Transfer Part of Jobs to Strategic Partners
The company will eliminate 5,500 jobs and transfer another 3,500 positions to strategic partners. According to the company, the job reductions do not affect the United States, which is its largest market.
BAT expects the cost-cutting program to deliver additional annual savings of 600 million pounds, approximately 16.9 billion Czech crowns, by 2028. By the end of next year, the company aims to save 500 million pounds.
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Stricter Regulation Slows Launch of New Nicotine Products
The company indicated back in February that its new productivity enhancement program could lead to job cuts. It has been particularly affected by sales restrictions in its largest market, where manufacturers of new nicotine products, such as e-cigarettes or nicotine pouches, must obtain licenses from regulators. This process is lengthy and has slowed product launches.
British American Tobacco is one of the world’s largest tobacco companies. It sells cigarette brands including Lucky Strike, Dunhill, and Kent. In recent years, it has accelerated its transition from traditional cigarettes to products such as Vuse e-cigarettes, glo heated tobacco devices, and Velo nicotine pouches. According to its website, it has 47,000 employees worldwide and more than 67 manufacturing facilities.
Source: ČTK
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