CHAMPAIGN – The newly merged Kraft Heinz will eliminate an undisclosed number of jobs at its Champaign plant as it moves cheese production to other facilities.
Advertisement
Wednesday’s news was considerably worse for other cities, including Madison, Wis., where 700 production workers learned that their almost century-old Oscar Mayer plant will close. About 400 people work at the Fullerton plant near Walnut and Raymond avenues, where Lunchables packaged meals are made.
Despite the looming loss of the factory, set to close within the next 12 to 24 months, San Leandro city officials believe they will be able to cope because other parts of the city’s economy have rebounded, thanks largely to the surging job market in the Bay Area.
“Additionally, Kraft Heinz is announcing that in 2016 we will move Oscar Mayer and our US Meats Business Unit from Madison, Wisconsin to our co-headquarters in Chicago”, Mullen stated. This will make Kraft Heinz more globally competitive and accelerate the Company’s future growth.
He also said WEDC reached out to Kraft Heinz on Wednesday to see if the state could do anything to reverse the decision. The moves comes a day after Kraft-Heinz said it would close Oscar Mayer’s almost 100-year-old headquarters and meat plant in Madison and move the corporate offices to Chicago. Collectively, they own 51-per cent stake in Kraft Heinz.
Kraft Heinz, the third-largest food and beverage maker in North America, is struggling to improve its profitability by lowering costs amidst sluggish sales as more and more consumers now prefer, health, fresh and organic foods to packaged foods. Buffett helped finance the merger that created the food company, and Berkshire became its largest shareholder in July.
“Our members are scared of the unknown”, said Jerry Messer, president of the Davenport chapter of the United Food and Production Workers, which represents employees. That’s on top of the 2,500 cuts announced in August and would be part of the $1.5 billion in annual spending cuts the company plans to achieve by end-2017, Bloomberg reported.
Advertisement
The state and Kraft-Heinz are also committing to each invest at least $20 million to support and modernize the company’s upstate operations. “Kraft Heinz fully appreciates and regrets the impact our decision will have on employees, their families and the communities in which these facilities are located”, Mullen said in a statement, addressing the situation of the employees that will be laid off.
