Top tobacco company to cut thousands of jobs

Key Points:

• British American Tobacco (BAT) plans to cut about 20% of its workforce, totaling around 5,500 job cuts and outsourcing 3,500 roles to third-party firms like Accenture, excluding the U.S. from these reductions.
• The restructuring aims to leverage artificial intelligence to lower costs and boost profits, targeting $793 million in annualized savings by 2028, with much of the savings expected by 2027.
• BAT is shifting focus from declining traditional tobacco products towards alternatives such as Vuse vapes and Velo nicotine pouches, although it currently trails industry rival Philip Morris International in this segment.
• The company faces challenges including tough U.S. regulatory approval for new products, illegal imports affecting sales, rising import taxes, tighter regulations, and illicit trade in various markets.
• Workforce changes involve Global Service Hubs in Costa Rica, Mexico, Romania, Malaysia, Pakistan, and some digital and technology roles in Poland and Romania, with ongoing employee consultations to comply with local laws.