British American Tobacco to close South African factory due to illicit trade
- Reports
- 3
- Developments
- 1
- Repetition
- 67%
New informationRepeats or wire copies
What happened
British American Tobacco is set to close its Heidelberg factory in South Africa by the end of the year. The company stated that the factory became unsustainable because legal products struggle to compete with illicit cigarettes. BAT estimates that approximately three out of every four cigarettes sold in South Africa are illicit, and the company plans to switch its operations to imports instead of manufacturing.
From businessday.co.za
Why it matters
The closure illustrates the impact of illicit trade on South Africa’s formal economy. The Heidelberg facility, which operated for more than 50 years, supported jobs, livelihoods, and economic activity across the value chain. BAT cited the inability of legal products to compete with illicit cigarettes sold at prices inconsistent with lawful tax compliance.
From businessday.co.za
Who's involved
- British American TobaccoIs closing its factory due to the impact of illicit trade.
- HeidelbergIs the location of the factory facing closure.
Who could feel it
Possible knock-on effectsThese are possibilities Brind reasoned out, not predictions, and not advice. Most are not stated in any report.
- British American TobaccoSpeculative
The factory closure might reduce the company's revenue and operational capacity in South Africa.
- London Stock ExchangeSpeculative
The revenue loss from the factory closure might affect British American Tobacco's stock value on the London Stock Exchange.
- GautengSpeculative
The closure might reduce local economic activity and tax revenue in the province.
Keep exploring
The entities involved
-
Heidelberg
town in the Western Cape province, South Africa
Nothing else this week.
-
British American Tobacco
British multinational tobacco company
Nothing else this week.