Cigarette use is at an all-time low. A tobacco giant pivots to new addictive products

British American Tobacco, known for brands like Pall Mall and Lucky Strike, says it is cutting 20% of its 47,000-person workforce. — Image credit: Roberto Machado Noa/LightRocket via Getty Images

This recording was made using enhanced software.

As fewer and fewer people look to get their nicotine fix from traditional cigarettes, one of the world’s largest tobacco companies is trying to keep up.

British American Tobacco, known for brands like Pall Mall and Lucky Strike, says it is cutting 20% of its 47,000-person workforce. The goal is to cut 5,500 jobs by the end of this year and outsource another 3,500.

The company says the cuts are part of a larger effort to save about $793 million in annual costs by 2028. The cuts will not impact jobs in the United States, where British American operates under its subsidiary, Reynolds American.

‘Future-ready’ tobacco

The job cuts and outsourcing come as the company faces declining demand for traditional cigarettes and looks for ways to invest in alternatives.

In a statement, Chief Executive Tadeu Marroco said the company is “building a future-ready organization” that will be “more agile, cost-disciplined and technology-enabled.”

The company has already invested in smoke-free products like Vuse vapes and Velo nicotine pouches.

Like its competitor Philip Morris, BAT is looking to generate more than half its future revenue from smokeless nicotine products, according to Bloomberg. BAT says its goal is to be “predominantly smokeless” by 2035.

Wolf von Dewitz/picture alliance via Getty Images

The interim chief financial officer, Javed Iqbal, told the Financial Times in February that the use of artificial intelligence and data analytics tools would also affect staffing levels. BAT already outsourced some of its work to Accenture, a consulting company that helps businesses modernize, last year.

Morocco said the deal gave BAT access to Accenture’s “advanced AI solution.” Since then, BAT says jobs in seven countries have been absorbed.

What’s driving the change?

A study published in the The New England Journal of Medicine in March found that cigarette use among U.S. adults hit an all-time low in 2024. At the same time, nicotine pouch sales rose more than 50%, according to the World Health Organization.

Multiple studies have shown that smokeless nicotine products, like nicotine pouches, are more addictive than cigarettes. Because the pouches come in varying strengths, some contain more nicotine than cigarettes or vapes, which build nicotine tolerance quickly and speed up the addiction process, according to Cleveland Clinic.

Shea Taylor

Shea Taylor is a producer at Straight Arrow. She helps produce Unbiased Updates to bring viewers the news they need to start their day.

Tags: AI, Artificial Intelligence, E-cigarettes, Health, Jobs, Smoking, Tobacco, Vaping

Why this story matters

A major tobacco company's shift away from cigarettes toward nicotine pouches and vapes reflects a documented change in how Americans consume nicotine, with health implications already noted by medical institutions.

Nicotine pouch addiction risk

According to Cleveland Clinic, nicotine pouches can contain more nicotine than cigarettes or vapes and build tolerance faster, accelerating addiction.

Cigarette use at record low

A March 2025 study in the New England Journal of Medicine found U.S. adult cigarette use hit an all-time low in 2024, while nicotine pouch sales rose more than 50%.

Get the big picture

Synthesized coverage insights across 53 media outlets

Context corner

The global tobacco industry has faced declining cigarette volumes for years due to health campaigns, rising taxes and stricter regulations. British American Tobacco's rival Philip Morris International has pursued a similar pivot toward smoke-free products, and British American Tobacco's South African factory was closed earlier in 2026 due to illicit trade competition.

Global impact

The restructuring spans most countries where British American Tobacco operates, including the U.K., Singapore, Poland, Romania, Costa Rica, Mexico and Malaysia, with 3,500 roles outsourced to Accenture and Systems Ltd. The South African factory closure, driven by illicit trade, reflects how illegal tobacco markets are reshaping British American Tobacco's global manufacturing footprint.

History lesson

Large-scale tobacco industry restructurings are not new. Rival Imperial Brands has targeted £320 million in annual savings by 2030, and Philip Morris International completed a $2 billion efficiency program by 2026, reflecting an industry-wide pattern of cost-cutting amid declining cigarette volumes.

Law and Order

8 hrs ago

4m read

How old is too old to be executed? Florida’s about to break its freshly set record
Social Issues

9 hrs ago

4m read

Could the World Cup revive America’s struggling dating culture?
Law and Order

9 hrs ago

3m read

ICE temporarily suspends most vehicle stops after 2 fatal shootings
Social Issues

11 hrs ago

5m read

Stop giving lettuce to neighbors: diarrhea-causing bacteria spreading paranoia, too

Sources

Bias comparison

Media outlets on the left foreground the human cost, using terms like “cut,” “slash costs,” and a “sweeping plan” to stress 9,000 layoffs, outsourcing, and AI-linked disruption.
Media outlets in the center stay narrower, simply noting the scale of “cost cutting.”
Media outlets on the right turn the same move into a broader story of national and industrial decline, with phrases like “axe,” “blow to the economy,” and “ready for the future,” plus added focus on BAT leaving Britain and shifting toward vapes and pouches as cigarette demand falls.

Report an issue with this comparison

Media landscape

Click on bars to see headlines

53 total sources

Key points from the Left

British American Tobacco plans to cut about 9,000 jobs, including 5,500 direct layoffs and 3,500 role moves to third-party firms, excluding the U.S., as part of a cost-cutting and AI transformation program.
The restructuring aims to save approximately £600 million annually by 2028, with £500 million targeted by 2027.
BAT is shifting its focus to smoking alternatives such as Vuse vapes and Velo nicotine pouches amid declines in traditional tobacco sales and regulatory challenges in the U.S..
CEO Tadeu Marroco stated that the changes will make the company more agile, cost-disciplined, and technology-enabled while emphasizing support for affected employees during the transition.

Report an issue with this summary

No coverage from Far Left sources 0 sources
No coverage from Left sources 0 sources
See Hide headlines from Lean Left sources 5 sources

Key points from the Center

On Monday, June 29, 2026, British American Tobacco announced an AI-driven restructuring eliminating 5,500 direct jobs and outsourcing 3,500 roles to Accenture, affecting 9,000 employees total to save £600 million annually by 2028.
The restructuring, part of the 'Fit2Win' strategy launched last year, aims to boost agility as BAT faces terminal decline in traditional tobacco volumes, projected to fall 2.5% this year.
Excluding U.S. Operations, BAT maintains its broader restructuring plan to deliver £500 million in savings by 2027, according to company financial disclosures.
Barclays analyst Pallav Mittal noted the scale of 'broad-based' reductions could surprise investors; shares fell 1.3% following the announcement.
Chief Executive Officer Tadeu Marroco stated the move positions the business as 'future-ready,' shifting focus toward smoke-free alternatives like Vuse vapes and Velo nicotine pouches to reverse sluggish sales growth.

Report an issue with this summary

See Hide headlines from Center sources 10 sources

Key points from the Right

British American Tobacco plans to cut about 9,000 jobs globally, including 5,500 direct layoffs and outsourcing 3,500 roles, excluding its US operations, to save costs and simplify operations by 2028.
The company partners with firms like Accenture and Systems Ltd to outsource roles in countries including the UK, Singapore, and Pakistan as part of this restructuring.
BAT aims to save £600 million annually by 2028, targeting £500 million by 2027, by using AI, data analytics, and operational simplification.
CEO Tadeu Marroco said these changes will make BAT more agile, cost-disciplined, and technology-enabled, while supporting affected employees respectfully.

Report an issue with this summary