InBev set to cut 1,400 U.S. jobs after Anheuser-Busch merger

The predictions have been confirmed: Following its acquisition of the largest brewery in the United States, InBev announces it will cut hundreds of jobs.

In July we said that Budweiser was not only the brand of beer chosen by one out of two Americans, the beer had in fact become an iconic symbol of American culture by sponsoring one of the most important sports events in the country -the Super Bowl- and displaying two national emblems on its label: the bald eagle and the colors red, white and blue. It came as no surprise then when members of the U.S. political establishment came out and voiced their opinion over the potential sale of A-B¹.

Then Republican presidential candidate John McCain -connected to A-B through his wife, Cindy Hensley, the owner of Budweiser’s exclusive distributor Hensley & Co.- was in a tight spot, because if he gave his approval to the purchase he risked being accused of anti-American, and if he spoke against it he could be attacked for opposing free trade. So he kept his opinion to himself. The now President-elect Barack Obama, however, issued a press release in which he said that “It was disappointing to hear that A-B agreed to be sold to InBev. A-B is an American icon and this sale could threaten thousands of jobs in Missouri.”

During the negotiations, the Brazilian Carlos Brito, who at the time was InBev’s Chief Executive Officer, traveled to Washington to lobby in the U.S. Congress, assuring the most influential legislators that A-B headquarters would not be relocated, no factories would be closed down, and there would be no mass layoffs. So all those U.S. citizens who associated their patriotism with a brand of beer could put their minds at ease.

Five months after the acquisition of Anheuser-Busch and 30 days after closing the deal, these assurances turned out to be just empty promises. On December 8, InBev announced its decision to cut 1,400 jobs in the United States. Anheuser-Busch President David Peacock said in a press release that the decision was made to “keep the business strong and competitive,” and that it was “a necessary but difficult move for the company.” Most of the layoffs will be effective by the end of this year and 75 percent of them will affect workers in Saint Louis, Missouri, where A-B headquarters had been located.

In July 2008, a story posted on the Saint Louis news website STLtoday.com cited statements by the president of the Latin American Federation of AmBev Workers, Siderlei Oliveira, where he said that over the past 18 years job cuts in Brazil’s brewery industry -where InBev’s subsidiary AmBev holds a virtual monopoly- have brought the number of beer sector workers down to 13,000 from the 23,000 it employed in 1990. “This is how they operate,” Oliveira said². Months ago, Siderlei Oliveira was warning in advance from Brazil what some in the United States are only just realizing now, when it is too late.