Kraft Heinz Bets $3 Billion On US Factory Overhaul To Offset Tariff Impact: Report

Kraft Heinz (NASDAQ:KHC) is investing $3 billion to modernize its U.S. factories.

According to Reuters, which first broke the news, this is the company’s largest domestic investment in a decade.

Kraft Heinz aims to cut costs amid weakening consumer sentiment and lowered financial forecasts.

According to Pedro Navio, president of Kraft Heinz North America, the upgrades are designed to improve plant efficiency and help offset the impact of tariffs implemented by the Trump administration.

The company, which operates 30 U.S. manufacturing plants and owns brands like Heinz and Kraft, also expects the upgrades to support faster product development.

The company is also adjusting to new U.S. tariffs, including a 10% levy on imports like coffee. While Kraft Heinz roasts and sells Maxwell House coffee, a spokesperson noted minimal exposure to higher Chinese tariffs.

Most of its U.S. products are manufactured domestically, using locally sourced ingredients such as tomatoes from California and potatoes from Idaho.

Kraft Heinz has asked suppliers to provide 60 days' notice before raising prices to manage cost pressures. The $3 billion investment is expected to create about 3,500 construction jobs, though the company does not plan to significantly expand its permanent workforce.

In April, Kraft Heinz reported a 6.4% year-over-year drop in first-quarter sales to $5.99 billion, missing analyst estimates. However, adjusted earnings per share of 62 cents beat expectations. Citing macroeconomic pressures, the company lowered its full-year 2025 outlook and anticipates a 1.5%–3.5% decline in organic sales.

Price Action: Kraft Heinz shares traded lower by 0.96% at $27.38 on Wednesday.

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