Quick Takeaways
- British American Tobacco South Africa (BATSA) plans to close its manufacturing plant in Heidelberg, Gauteng by the end of 2026, ending local production of factory-made cigarettes.
- The company will shift from domestic manufacturing to an “import-led supply chain,” while saying it will continue operating in the South African market.
- BATSA said illicit cigarettes account for about 75% of South Africa’s cigarette market, and the plant is currently running at around 35% capacity.
- The company blamed illicit trade on weak enforcement and a range of policy factors, adding it would consider resuming local production if conditions improve materially.
2Firsts, Jan 16, 2026
According to Reuters, British American Tobacco South Africa (BATSA) said it will end local production of factory-made cigarettes (FMC) in South Africa and shut its manufacturing plant in Heidelberg, Gauteng by the end of 2026, as illicit cigarette trade continues to expand. Going forward, the company will supply the market through imports and said it will continue to serve adult consumers in South Africa.
In a statement, BATSA said about 75% of South Africa’s cigarette market is estimated to be illicit, making continued domestic manufacturing “no longer viable.” It added that the Heidelberg plant is currently operating at roughly 35% capacity due to declining volumes.
On employment, BATSA said the closure would put around 230 jobs at risk in Lesedi Municipality. The company said it launched a legally required consultation process on Jan 15 and expects to conclude consultations by the end of March 2026, with the plant’s full closure scheduled for the end of 2026.
BATSA also linked the illicit trade problem to weak enforcement and several policy-related factors, including the tobacco sales ban during the COVID-19 pandemic in 2020, excise tax increases above inflation, and tobacco-control legislation currently under consideration in parliament. The company said it would consider reinvesting in local production if South Africa’s illicit trade environment shows a “significant and sustained” improvement.
Cover image source: Reuters
