British American Tobacco rolls out plan for thousands of job cuts in AI streamlining
British American Tobacco is to cut thousands of jobs in the latest sign of artificial intelligence transforming outsourcing initiatives at some of the City’s biggest names.
The FTSE 100 firm expects to cut 5,500 jobs by the end of the year, it said in a statement on Monday. Alongside the cuts, 3,500 more jobs will be outsourced.
It means a total of 9,000 roles are affected at the maker of Lucky Strike cigarettes and Vuse vapes, outside its US operations. They amount to over 19 per cent of its global workforce.
British American Tobacco (BAT) is faced with falling demand for traditional tobacco across developed markets.
It has predicted that global industry-wide cigarette volumes will fall by 2.5 per cent in 2026. It launched its latest streamlining initiative, “Fit2Win” in 2025, to reduce complexity as well as to save costs.
BAT employs around 47,000 people globally and operates in around 180 countries and markets.
In a Monday update, the £101bn multinational stood by guidance to save around £600m in annual costs by 2028. But it also shed more light on the nature of the changes.
BAT has formed what it calls “strategic partnerships” struck with “world leading technology and business services companies” to make the savings.
One such deal, with Accenture, has moved jobs from BAT’s “global service hubs” to the global professional services giant.
Sign of the times?
Such changes have already happened in Costa Rica, Mexico, Poland, Romania and Malaysia. Jobs within BAT supply operations in the UK and Singapore have also moved to Accenture.
Under the terms of the deal, BAT has access to what Accenture calls its “Agentic AI solutions”.
There has been a similar pattern with a different partner in Pakistan. Meanwhile, digital and technology roles in Poland and Romania have moved to another partner, ITC Infotech, which is also involved in collaborating on a new facility in India, and existing tech centres in Malaysia and Mexico.
Russ Mould, investment director at AJ Bell, said: “The scale of cutbacks is a sign of the times, and the trend is worrying for the state of the labour market.
“Major investments in technology continue to prompt significant headcount reductions in global companies as they strive for greater efficiencies.
“British American Tobacco is the latest name to ramp up the use of technology to help its business run more smoothly and be able to launch new products faster.”
Known throughout the City as Bats, after its stock ticker trading symbol, the firm first listed on the Stock Exchange in 1912. It is also famed for a long history as a major dividend payer, paying out an average of 6.6 per cent over the last ten years.
Shares fell 1.7 per cent to 4,670p on Monday.
Tadeu Marroco, BAT chief executive, said: “Whether through strategic partnerships or a more focused operational footprint, we are creating a simpler, faster BAT.”
He added: “These changes affect many of our colleagues, and we are focused on supporting them through this transition with care and respect, as we position the business for the future.”