Kraft to cut 400 jobs in North America

[October 07, 2008]  NEW YORK (AP) -- Foodmaker Kraft Foods Inc. said Monday it is cutting 400 jobs in North America to reduce costs.

Kraft spokeswoman Renee Zahery said the layoffs will represent a cut of about 1 percent in the company's North American work force.

Zahery said the layoffs will take place across the board in all geographies but will mainly affect employees in its Chicago; Madison, Wis.; Tarrytown, N.Y.; East Hanover, N.J.; and Toronto, Canada offices.

The nation's largest food and beverage maker is in the middle of a three-year transformation that aims to improve sales and profits by lowering costs, launching new products and boosting marketing. The company has also said it hopes to deliver cost savings of $1 billion a year as part of a separate restructuring plan.

Zahery said economic conditions required the company to "be cost-conscious day in and day out."

"We looked at eliminating jobs as a last resort," she said.

She added that all affected employees will be informed by Friday.

Kraft, like most food makers, has had to deal with higher commodity and energy costs. Kraft, though, has been able to offset much of the increase with higher retail prices. Those price increases helped the company report strong profit and sales growth in its last quarter.

Kraft shares fell $1.35, or 4 percent, to close at $31.73.

[Associated Press; By LAUREN SHEPHERD]

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