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Japan Tobacco Inc. said Tuesday it will shut down a plant and shed 3,000 jobs as the company is restructuring its domestic tobacco operations to meet falling demand.

JT will close its tobacco plant in Chikushino, Fukuoka Prefecture, southwestern Japan, at the end of March 2022. It will also shut down a tobacco filter plant run by a subsidiary in Tagawa in the same prefecture, at the same time.

Japan Tobacco Inc. President and CEO Masamichi Terabatake speaks during an online news conference Tuesday. | KYODO
Japan Tobacco Inc. President and CEO Masamichi Terabatake speaks during an online news conference Tuesday. | KYODO

The company will shed about 20% of its 13,500 workers. It will offer buyout packages to 1,000 full-time and 150 postretirement workers while asking about 1,600 part-timers to quit. All of them are expected to leave the company at the end of March 2022.

JT’s restructuring comes as Japanese people are becoming more health-conscious. “We made this tough decision as the Japanese market has kept shrinking,” President and CEO Masamichi Terabatake said in an online news conference.

The company will consolidate its domestic and overseas tobacco businesses, while unifying its headquarters functions into Geneva in January 2022. The Japanese headquarters will be left with domestic marketing and product development functions.

In Japan, JT will reorganize its operations into 47 branch offices from the current combination of 15 branch offices and 145 outposts covering smaller areas.

JT said its sales fell 3.8% to ¥2.09 trillion in 2020 from the previous year. The coronavirus pandemic dragged down tobacco sales at airport duty-free shops, while restaurant demand for processed food products sagged.

Net profit dropped 10.9% to ¥310.2 billion, although the company booked ¥41.3 billion in proceeds from the sale of its old headquarters building.

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