Cans produced for Coca-Cola Co.’s cola beverage move along the production line.
Chris Ratcliffe | Bloomberg | Getty Images
Coca-Cola will cut approximately 2,200 jobs worldwide as part of a broader restructuring plan accelerated by the coronavirus pandemic.
In the United States, Coke will use layoffs and buyouts to cut about 1,200 jobs, accounting for about 12% of the home market’s workforce. The news was first reported by The Wall Street Journal.
At the end of 2019, the Atlanta-based company had 86,200 employees worldwide. But the pandemic battered its earnings and added costs to the beverage giant. About half of the turnover usually comes from consumers who drink their drinks away from home. In the third quarter, net sales decreased by 9%.
Coke has responded to the crisis by accelerating plans to restructure its operations and downsize its portfolio. It has stopped producing drinks like Tab and the Odwalla brand that don’t sell well and don’t offer much growth opportunities. The company plans to build new operating units targeting the regional and local levels that will work closely with five global marketing teams divided by category.
Part of the reorganization includes job cuts. In August, Coke said it would offer voluntary redundancy packages to 4,000 workers in the US, Canada and Puerto Rico.
In total, Coke expects to spend $ 350 million to $ 550 million in termination benefits. The job losses do not include the employees of the bottlers.
Shares of Coke, with a market value of $ 230 billion, were up less than 1% during afternoon trading. The stock is down 3% so far in 2020.