Pepsi to Cut 120 Chicago Jobs
Posted on October 15, 2008
A popular soft drink company will soon be cutting more than 100 Chicago jobs.
PepsiCo Inc. is cutting 3,300 jobs in total, 120 of those based in Chicago. The city is home to Pepsi’s headquarters for Gatorade, Tropicana and Quaker Oats business units. Of the 120 positions being cut, 100 are in the companies’ West Loop offices, where the majority of workers are located, while the other 20 cuts are at a research and development facility in Barrington.
Gatorade, Tropicana and Quaker Oats employ 2,400 people in Chicago, meaning the cuts will amount to 5 percent of the company’s workforce. The total number of cuts represent 1.8 percent of Pepsi’s global workforce, according to an article by the Chicago Tribune.
The cuts are part of a plan by Pepsi to save more than $1.2 billion during the next three years, according to an article by the Financial Times. The company’s stock share recently dropped by 11.9 percent to $54.40 per share, while Coca Cola saw its stock drop 7.5 percent to $43.73 per share and and Dr. Pepper Snapple’s stock dropped 3.3 percent to $23 per share.
The Chicago Board Options Exchange Volatility index, also known as Wall Street’s fear gauge, rose as much as 8.8 percent to 59.81, which continued to indicate signs of severe distress.
“You’d be delirious to say all of a sudden that this situation has been resolved,” Joe Cusick, analyst at OptionsXpress, said in the article, adding the reaction to the PepsiCo numbers showed traders were “starting to focus on the earnings and economic outlook.”