Home Daily Digest Coca Cola downsizes, asks 65 workers to opt for VRS

Coca Cola downsizes, asks 65 workers to opt for VRS

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Coca Cola downsizes, asks 65 workers to opt for VRS
Flagging demand has led the company to suspend operations at five plants across India

Popular beverage manufacturer Coca-Cola has let go of 65 employees at its bottling unit Hindustan Coca-Cola Beverages (HCCB) through a voluntary retirement scheme (VRS).

The company has suspended operations at five plants citing flagging demand and is also exploring options to sell the company-owned bottling business, says a report in The Economic Times.

According to the report in The Economic Times, an HCCB spokesperson has confirmed the development. These five factories employed 390 people and half of them are still on the rolls of the company and have yet to make a decision. One-third of the employees have chosen to relocate to other locations and the remaining have opted for VRS, the spokesperson told ET.

This is possibly the largest number of employees that Coca-Cola has let go of in the country at any one given time.

HCCB directly employs 9,500 people and bottles 65 per cent of the company’s total volume sold in India

The company is mulling sale of its bottling units, valued at around $1 billion. The soft drink giant has cited water shortage and flagging demand in many areas as a reason for shutting down these plant.

Water shortages were already a reality in Kaladera, Rajasthan when set up shop in 2000. Farmers – already crippled by debt due to bad monsoons – blamed the company for making the water situation worse.

Allegations of water mismanagement have dogged Coca-Cola across India and have forced the closure of their bottling plants in Kerala in 2005 and Varanasi in August 2014.

Curiously, Coca Cola has been listed as one of the 50 most sustainable companies of the world in 2016 by Corporate Knights, a Toronto-based media company.

The company is now in the process of initiating talks with large industrial houses for a potential deal.

The other plants which it plans to sell are in Andhra Pradesh, UP and in the Northeast. These range from small to mid-sized ones. HCCB has two dozen company-owned plants while an equal number of facilities are managed by 13 independent franchisee bottlers.