British American Tobacco (BAT) has said it plans to cut 2,300 jobs globally by January as its new boss seeks to drive revenues in controversial e-cigarettes.
In a statement on Thursday the chief executive Jack Bowel said “My goal is to oversee a step change in new category growth and significantly simplify our current ways of working and business processes, whilst delivering long-term sustainable returns for our shareholders. This is a vital first move,”.
The announcement comes a day after United States President Donald Trump’s administration said it would soon ban flavoured e-cigarette products to stem a rising tide of young users following a spike in vaping-linked deaths.
Companies such as BAT are looking to strong revenue streams from e-cigarettes in the face of falling demand for traditional tobacco products, especially in Western markets, where high taxes, public smoking bans and health worries have persuaded consumers to turn to controversial alternatives.
Bowles said the job cuts, of which more than 20 percent will be senior roles, would see BAT “better placed” to deliver 5 billion pounds [$6.2bn] in new category revenues by 2024.
“A programme of this significance involves decisions that will be difficult for our people, but ultimately it is the right thing for our business,” said Bowles, who became the CEO of the maker of Dunhill and Lucky Strike cigarettes this year.
BAT employs some 55,000 staff worldwide and did not specify which regions would suffer the job cuts, equal to a little over four percent of its workforce.