Coca-Cola (KO-US) announced Thursday that it will cut its global workforce by about 2,200 people as the outbreak of the New Guinea virus accelerates a broad restructuring plan at the company.
The Wall Street Journal reports that in the United States, Coca-Cola will use layoffs and voluntary separation programs to cut its workforce by about 1,200 people, or about 12 percent of its U.S. market workforce.
Atlanta-based Coca-Cola employs 86,200 people worldwide at the end of 2019, but the new crown epidemic has hit its revenue and raised costs, as about half of sales usually come from consumers drinking its beverages outside their homes. Coca-Cola’s net sales fell 9 percent in the third quarter.
In light of this, Coca-Cola accelerated plans to restructure its business and reduce its investment portfolio. The company has discontinued production of Tab and Odwalla branded beverages due to poor sales and little growth opportunity. The company plans to create new operating units that will focus on a regional and local level and will also work closely with global marketing leadership teams in five categories.
Part of Coca-Cola’s restructuring includes layoffs, as the company announced in August that it would offer voluntary severance packages for 4,000 employees in the U.S., Canada and Puerto Rico.
Coca-Cola expects to spend a total of $350 million to $550 million in severance costs. The layoffs do not include its bottling plants.
Coca-Cola has a market capitalization of $230 billion and its shares are down 3.7 percent so far this year.
Recent Comments