PepsiCo Cuts Costs, Lays Off 83 Workers Amid Global Challenges

PepsiCo is closing parts of its Detroit beverage facility, impacting 83 workers, as part of cost-cutting efforts. The company is focusing on healthier products, such as its Frito-Lay's Simply lineup, and expanding its health-focused portfolio through acquisitions like Siete Foods. PepsiCo beat Q2 2025 earnings expectations, benefiting from international growth and favorable foreign exchange, but faces ongoing cost pressures. JPMorgan raised PepsiCo's price target to $157 in July 2025.

PepsiCo, the global snack and beverage giant, has announced the closure of part of its Detroit beverage facility, impacting 83 workers. The decision, detailed in a Michigan WARN notice, comes as the company aims to align production with sagging consumer demand [2]. The facility's production, maintenance, and transport operations will cease on September 27, while other functions such as warehouse, fleet, delivery, sales, and field-service technician teams will continue to operate [2].

The closure is part of PepsiCo's broader strategy to consolidate operations and improve cost efficiency. Last year, the company shuttered bottling plants in several states, including Ohio, Pennsylvania, Illinois, and Georgia, and snack facilities in New York and California [2]. This latest move underscores PepsiCo's commitment to streamlining its operations and reducing costs.

In parallel, PepsiCo is doubling down on healthier products and expanding its health-focused portfolio. The company has introduced prebiotic versions of its Pepsi brand and is launching liquid protein beverages in late 2025 and early 2026 [3]. Additionally, PepsiCo has acquired Siete Foods, a plant-based food company, to bolster its health-conscious offerings [3].

Despite these cost-cutting measures, PepsiCo reported strong Q2 2025 earnings, driven by international growth and favorable foreign exchange rates. The company's CEO, Ramon Laguarta, emphasized the integration of its snacks and drinks businesses in North America to enhance productivity and competitiveness [1]. However, the company continues to face ongoing cost pressures and remains focused on improving its cost structure [1].

JPMorgan recently raised PepsiCo's price target to $157, reflecting the market's optimism about the company's strategic initiatives and the potential for future growth [4].

References:
[1] https://finance.yahoo.com/news/pepsico-shut-manufacturing-operations-us-134857816.html
[2] https://www.supplychaindive.com/news/pepsico-to-close-portion-of-detroit-plant/754176/
[3] https://www.nasdaq.com/articles/will-pepsicos-focus-premium-drinks-drive-next-leg-growth
[4] https://www.nasdaq.com/articles/celestica-and-westlake-have-been-highlighted-zacks-bull-and-bear-day