The real reason Philip Morris is closing.

It seems there's a lot of people that think the one reason the Philip Morris plant in Concord is closing is because people smoke less. I think that's BS.

Of course the company wants you to believe that's the main reason and states it in their press release that announces the closure of the Concord plant.

But something doesn't add up...

From the same press release:

"It is my hope that the majority of employees at Cabarrus will be able to relocate to Richmond.", said Mike Szymanczyk, chairman and chief executive officer of PM USA.

As a result of increased production requirements at its operations in Richmond, coupled with ongoing retirements of current Richmond-based employees, PM USA expects to be able to offer positions in Richmond to most North Carolina-based hourly employees and many salaried employees.

If they want to move the majority of employees to Richmond and there are increased production requirements there, don't you think that the demand for cigarettes isn't shrinking that much? Or are they saying that they have 2000 people in Richmond waiting to retire?

The cigarettes that were made for export in Concord are now going to be made in Europe.
Philip Morris can produce cigarettes cheaper in eastern Europe due to much lower wages and closeness to an expanding market.

Which brings us to the real reason for the Concord plant closure:

Total annual pre-tax cost savings of approximately $335 million by 2011

Translation: We want to close our Concord plant so we can start saving $335 million every single year even though Philip Morris USA made $4.6 billion in profits in 2005 alone.
Did you really expect anything else?

Of course Altria (parent company of Philip Morris USA) isn't going to say "hey, we want to close our plant in Concord so we can save a a few hundred million $ every year, screw the workers.", no they rather wrap that decision in some (mostly) phony reason that everyone will immediately believe.
On top of that they abuse the loss of 2500 jobs for another snipe at all those anti-smoking groups and people that sued them because they're dying from smoking Philip Morris products.

But why close Concord and not Richmond? The company expects it can sell the Concord property for more than the Richmond site.

If you still believe that a multinational corporation like Altria cares about some workers in Cabarrus County, I'd like to sell you a bridge in Alaska.