Kraft Heinz Layoffs: KHC to Cut 2600 Jobs, Close Plants

Now their parent company, the closure of the plant is part of Kraft Heinz’s plan to close seven factories in the US and Canada.

In recent months, Kraft Heinz has announced a swathe of job cuts and factory closures as it streamlines its operations in order to reduce costs. Kraft Heinz, formed by a recent merger, said it will use the financial assistance package to demolish its current plant in Davenport and build a new facility several miles away.

That includes about 400 workers at the plant in Avon which makes Cool Whip and Lunchables, and the plant in Campbell in Steuben County that makes string cheese among other products and employs almost 400.

KRAFT Heinz Co (KHC.O), the maker of Jell-O and Heinz Tomato Ketchup, will close seven factories and lay off about 2600 workers in North America, a company spokesman said.

The decision by Kraft Heinz to close the Oscar Mayer facility, which has operated in Madison for almost a century, “was based entirely on the need to reduce operational redundancies and eliminate excess capacity within our North American network”, said Michael Mullen, senior vice president of corporate and government affairs at Pittsburgh-based Kraft Heinz. “We have reached this hard but necessary decision after thoroughly exploring extensive alternatives and options”, he said. In August, the company moved to cut 2,500 positions in the US and Canada, including 700 jobs at the Northfield headquarters of Kraft. Even with the new plant, hundreds of jobs will be lost.

The two firms merged in a $46bn (£30bn) deal in July to create North America’s third biggest food company. The move, which the company says is part of an effort to save money through consolidation efforts, will put almost 1,000 area employees out of work.

Plant employees talk on phones and with each other after a meeting was called at Kraft Foods-Oscar Meyer headquarters and plant in Madison, Wis., Wednesday, November 4, 2015.

On a conference call with analysts, Chief Executive Bernardo Hees said the company was in the process of rolling out zero-based budgeting, a tool where expenses are justified for each new period, across the newly combined company.