Japan Tobacco to Boost PloomX Investment, Aims to Expand to 20+ Countries by 2024
According to foreign media reports on April 15, Japan Tobacco (JTI) will invest 300 billion yen (about 2.25 billion U.S. dollars) in the next three years to promote its heat-not-burn product Ploom X, of which 200 billion yen (about 1.5 billion U.S. dollars) will be used in markets outside of Japan.
JTI President Masamichi Terabatake said in an interview that most of the investment will be the initial cost of entering new markets.
Japan Tobacco will increase investment in Ploom X and plans to cover at least 20 countries by the end of 2024
Terabatake also said that due to the shortage of semiconductors and insufficient heating tobacco equipment, JTI was unable to invest last year; this year, JTI's procurement will be back on track. Compared with last year, JTI can secure more than twice the supply in Japan.
According to the report, JTI has not disclosed the investment in heated tobacco products from 2020 to 2022, but the investment seems to exceed the expenditure of these three years.
Currently, JTI is only selling the Ploom X in Japan and the UK, and it will launch in Italy this month.
JTI plans to launch Ploom X in more than 10 countries this year and cover at least 20 countries by the end of 2024.
Japan Tobacco will increase investment in Ploom X and plans to cover at least 20 countries by the end of 2024
According to previous reports, in October 2022, JTI and Altria established a joint venture company, hoping to pass the FDA's PMTA application before 2025, so that the product can be marketed in the United States in compliance.
It is reported that JTI’s heated tobacco division is currently at a loss due to long-term investment, but JTI expects to turn losses into profits in 2028 due to overseas growth.
JTI will also invest in research and development funds, seeking to develop second and third generation Ploom X products.
Because heated tobacco is still in its infancy, Terabatake said, the improvements are likely to last for generations.
Global cigarette sales fell 1.5 percent last year, JTI said. But heated tobacco has made headway: the global market grew 17 percent last year to $33.4 billion, according to Euromonitor International, a British research group.
references:
[1] Japan Tobacco takes heated sticks overseas in $2bn push
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