The Coca-Cola Co. is planning to cut up to 2,200 people from its global workforce as part of a broader restructuring.
The company is accelerating its efforts to reduce cost and focus more on its core business as the coronavirus pandemic continues to negatively affect its finances.
The company said that it will be eliminating around 1,200 jobs in the U.S. - or about 12% of its workforce in its home market. About 500 of those jobs will be from the company's operations in the Atlanta metro area - where the company is based. Some employees will be offered buyout packages depending on their tenure and positions.
In August, Coca-Cola said that it would be cutting more than 4,000 jobs in its facilities in Canada, the U.S., and Puerto Rico. Most of those that were cut were offered voluntary layoff packages.
Coca-Cola said that it expects to spend between $350 million and $550 million in severance costs.
Before the pandemic, Coca-Cola had about 86,200 employees worldwide. The health and economic crisis battered the company's revenues and increased its spending. With restaurants forced to close down worldwide, the company's sales continued to drop.
For its third quarter, the company's net sales dropped by more than 9% to $8.7 billion. The company attributed the loss to the permanent closure of thousands of restaurants worldwide because of the pandemic.
In response to the pandemic, the company was forced to accelerate its restructuring plan. This included the slimming down of its portfolio, resulting in the scrapping of several underperforming brands.
The company recently stopped producing beverage brands such as Odwalla, Zico and Tab, which it said were not selling well and presented very little opportunity for growth. Coca-Cola said that it will be focusing on its most popular segments, which include its Coke and Coke Zero carbonated beverages.
Part of the company's restructuring plan will be to establish new operating units that are focused on the local and regional levels. Each unit will be working with five global marketing leadership teams, which are divided up by category.
