By Everson Luhanga
- British American Tobacco will shut its Heidelberg factory, putting about 1,500 workers out of work.
- The company blames illegal cigarettes, which now dominate the local market and undercut legal jobs.
For workers at the British American Tobacco factory in Heidelberg, survival has become the biggest worry.
Many have worked at the plant for decades. Many support extended families who depend on their monthly income.
The closure ends more than 70 years of cigarette manufacturing in South Africa.
British American Tobacco says the factory is no longer viable. The plant is running at just 35% capacity.
The company blames the rise of illegal cigarettes, which it says now make up about 75% of the local market.
As illegal cigarettes flood the streets at very low prices, legal factories are shrinking. Sales volumes at the company dropped by 40% between 2020 and 2025.
Instead of hiring, companies are cutting jobs or shutting down completely.
Although the factory will close, the company will continue selling cigarettes in South Africa through imports. It will also keep its listing on the Johannesburg Stock Exchange.
For Heidelberg and the wider Lesedi Municipality, the impact will be severe.
A company study found that most retailers sell illegal cigarettes, often below the legal tax price.
This has cost the government an estimated R28-billion in lost tax revenue every year.
ActionSA leader Herman Mashaba said the country is failing its manufacturing sector and millions of unemployed people.
Pictured above: The British American Tobacco factory in Heidelberg.
Image source: British American Tobacco
