British American Tobacco To Cut 9,000 Jobs Globally As Shift To Smoke-Free Alternatives Takes Pace

British American Tobacco (BAT) is set to cut approximately 9,000 jobs globally as part of a large-scale restructuring effort aimed at reducing costs and accelerating its transition away from traditional cigarettes, according to a Bloomberg report citing an internal company notice.

The planned job reductions represent nearly one-fifth of BAT’s 47,000 employees outside its US operations.

The company is facing declining demand for combustible tobacco products while simultaneously increasing investment in smoke-free alternatives such as vaping devices and nicotine pouches.

According to the internal communication, BAT plans to eliminate around 5,500 roles directly while outsourcing an additional 3,500 positions by the end of this year.

The restructuring is part of a broader strategy to achieve £600 million (approximately $793 million) in annual cost savings by 2028.

The company is expected to provide further details of its restructuring plan during an upcoming investor briefing.

The overhaul reflects BAT’s effort to reposition itself in a rapidly evolving nicotine market where consumers are increasingly shifting away from traditional cigarettes.

BAT aims for more than half of its revenue to come from non-combustible products, including its Vuse vaping devices and Velo nicotine pouches.

This transition mirrors industry-wide changes led by competitors such as Philip Morris International, which are also investing heavily in reduced-risk products.

The decline in cigarette consumption across global markets has intensified pressure on tobacco companies to redirect resources toward alternative products designed for adult smokers looking to quit or reduce usage.

Earlier projections from BAT indicated that global cigarette volumes are expected to fall by 2% in 2026.

The restructuring also includes operational changes such as factory closures, including the shutdown of its South African cigarette manufacturing plant earlier this year due to rising illicit trade pressures.

BAT is increasingly relying on automation, artificial intelligence, and outsourcing to streamline operations.

Interim CFO Javed Iqbal noted that AI and data analytics will significantly reshape workforce requirements, with around £500 million in savings expected by 2027.

The company has expanded outsourcing partnerships with Accenture across multiple countries, including the UK, Singapore, Costa Rica, Mexico, Poland, Romania, and Malaysia, while also outsourcing some operations in Pakistan to local firms.

CEO Tadeu Marroco said the restructuring will impact many employees but emphasized that the company is committed to supporting staff during the transition as it prepares for long-term transformation.