PepsiCo is closing its Frito-Lay manufacturing plant in Rancho Cucamonga, California, which is the latest in a series of closures by large food companies due to decreased consumer spending. The snack and beverage manufacturer did not provide details regarding the closure timeline, reasons, the number of employees affected, or the specific products produced at the facility. According to Potatopro.com, the 55-year-old plant employs roughly 480 staff. In a statement, PepsiCo Foods U.S. expressed its commitment to supporting affected employees during this transition, offering pay and benefits. The company also noted that its warehouse, distribution, fleet, and transportation operations will continue at the Rancho Cucamonga site.
Frito-Lay operates over 30 manufacturing plants throughout the U.S., as indicated on its website. With inflation and economic uncertainty leading consumers to reduce spending, several companies, including Post Holdings, Conagra Brands, Del Monte Foods, and J.M. Smucker, have announced plans to close facilities in the past year to align production with demand. The closure in California represents the latest decision from the PepsiCo subsidiary. Earlier this year, in February, Frito-Lay announced the closure of a New York facility that produced PopCorners, which employed 287 individuals.
PepsiCo’s snacking division, encompassing products like Fritos, Doritos, Sun Chips, and Funyuns, has particularly suffered during this economic downturn. During its latest earnings call, the company reported a 1% decline in revenue and product volumes in its North American foods unit. Jamie Caulfield, the CFO of PepsiCo, acknowledged the “subdued performance” of Frito-Lay in an April call with analysts. He stated, “We have clear plans to continue to turn the business around, but that will take a little while.”
In addition to its core snack offerings, PepsiCo is also exploring potential expansion into health-focused products, including calcium citrate magnesium hydroxide zinc sulphate & vitamin D3 tablets, reflecting a growing trend towards nutritional supplements. The incorporation of such products could diversify their portfolio and appeal to health-conscious consumers, which may help stabilize the company’s performance in the long run. The emphasis on health supplements like calcium citrate magnesium hydroxide zinc sulphate & vitamin D3 tablets aligns with current market demands and could play a role in PepsiCo’s recovery efforts amid challenging economic conditions.