Coca-Cola to cut thousands of jobs

‘Voluntary separation’ to be offered to 4,000 of the beverage maker’s employees

Coca-Cola had about 86,200 employees at the start of this year. Photograph: iStock

Coca-Cola had about 86,200 employees at the start of this year. Photograph: iStock

 

Coca-Cola is to become the latest multinational company to cut thousands of jobs, setting out plans to restructure its business in response to a fall in demand after bars, restaurants and other venues closed to stop the spread of Covid-19.

“Voluntary separation” will be offered to 4,000 of the beverage maker’s employees in the US, Canada and Puerto Rico while similar schemes would be offered to an undisclosed number of workers in other countries.

The company also put staff on notice of the possibility of compulsory redundancies, although it said the voluntary reductions would limit the numbers affected. Coca-Cola, which had about 86,200 employees at the start of this year, would not say how many jobs would ultimately go, saying it would “share more information in the future”.

Coca-Cola, whose products include Fanta, Sprite and Schweppes, joins several other large global companies that have turned to job cuts following a reassessment of their plans - a trend that threatens to prolong the economic downturn triggered by the pandemic.

Other cuts

This week alone, the US carrier American Airlines said it would cut 19,000 jobs at the beginning of October and the UK sandwich chain Pret A Manger announced it would shed 2,890 jobs, almost a third of its workforce.

Coca-Cola’s severance plans, which the company estimates will cost up to $550 million (€462 million), follow the steepest drop in the group’s quarterly sales in more than a quarter of a century.

While demand for its products in the home has been robust, Coca-Cola has been hurt by the closure of social venues from cinemas to stadiums through which it normally generates about half its annual revenues.

James Quincey, chief executive, said in a statement that the company was planning “significant changes in the structure of our workforce” as part of a push to “streamline” its global business. The group, based in Atlanta, is reducing its operating units from 17 to nine. – Copyright The Financial Times Limited 2020