PepsiCo this week promptly shut down a bottling plant in East Tennessee and cut over 100 jobs amid broader concerns within the company about its beverage business.
The food and beverage giant said in a brief statement Monday that it made the “difficult decision” to close the Knoxville plant “immediately.” The company indicated in a filing with state officials that the move would result in 112 layoffs, according to the Knoxville News Sentinel, but those workers will continue to receive pay and benefits through the beginning of next year.
The announcement came just days after PepsiCo’s latest quarterly earnings report, which saw weaker results in North America and a 2% volume decline in its beverage operations in the region.
Ramon Laguarta, the company’s CEO, said during its earnings call that PepsiCo officials did not “feel good about the beverage business,” and that the company was “putting all the urgency of the business, and the focus in improving [its] performance, in soft drinks.” The company, like other food and beverage processors, is attempting to navigate rising costs for fuel, commodities, aluminum and other inputs without alienating cash-strapped households.
PepsiCo’s sales and delivery staff in the Knoxville area would not be affected, the company’s statement added; it operates a sales office in the city, along with other East Tennessee operations in Johnson City and Chattanooga. The News Sentinel noted that the end of the Knoxville plant follows four previous PepsiCo bottling facility closures in 2024.
