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Japan Tobacco to Cut 1,600 Jobs, Close Four Plants

Oct. 30, 2013
"We believe that adaptability to a changing environment is critical to achieving sustainable profit growth in the mid- to long-term," JT president and chief executive officer Mitsuomi Koizumi said.

TOKYO - Japan Tobacco (IW 1000/192) said Wednesday it will slash 1,600 jobs and close four factories, downsizing domestic cigarette production as sales fall at home.

In a major overhaul, JT will cut about a fifth of its 8,900 workforce in its core tobacco business.

In addition to the job cuts, which the company wants to make through voluntary retirement and other schemes, it will also close four out of nine factories in Japan and reduce the number of its branch offices from 25 to 15.

The company decided to take the steps to deal with "the anticipated consequences of future industry contraction in the mid- to long-term."

"We believe that adaptability to a changing environment is critical to achieving sustainable profit growth in the mid- to long-term," JT president and chief executive officer Mitsuomi Koizumi said in a statement.

JT, one of the world's biggest tobacco firms, whose international brands include Winston and Camel, has a brisk overseas business but has suffered lackluster domestic sales, as Japan's once huge number of smokers shrinks.

Japan has traditionally been unusual among industrialized countries for the size of its smoking population, but there are signs it is becoming less popular. Figures from Japan Tobacco show that 21 percent of adults smoke now, down from 25 percent in 2009.

An increased sales tax, set to be introduced in April, is also expected to take its toll on the domestic market, and observers say they expect the company to focus on overseas sales and other segments such as food and medical products.

Copyright Agence France-Presse, 2013

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