PMI's Heated Tobacco Products Struggle in Spanish Market

On May 13th, according to Spanish news website El Periódico, Massimo Andolina, the European President of PMI, stated that their heated tobacco products have not met expectations in the Spanish market. Out of the 9 million smokers in Spain, only 300,000 use heated tobacco products. Andolina suggested that Spain should learn from their neighbor Portugal.

The revenue from smokeless products did not meet expectations.

In 2016, PMI announced plans to stop traditional cigarette production by introducing new tobacco products. Currently, 35% of PMI's revenue comes from what they call "smoke-free products". Their goal is to have over 50% of revenue from "smoke-free products" by 2025.

This has already been achieved in 17 global markets, including Denmark, Italy, Japan, and other countries. However, it has not yet been implemented in the Spanish market. Their new type of tobacco product only accounts for 5% of total revenue in the Spanish market.

Massimo Andolina, President of the European region, has stated that the Spanish government acknowledged the differences between traditional cigarettes and electronic cigarettes when it issued the Tobacco Directive in 2014. However, Spain prohibits the provision of information about heated tobacco products to consumers, which greatly limits the possibility of attracting customers.

According to Andorinha, PMI has an innovation center in Portugal, and he believes that Spain should learn from neighboring Portugal.

The Spanish government needs to acknowledge that neighboring countries such as Portugal have strict regulations but recognize that these alternative products are better than traditional cigarettes.

PMI aims to gain knowledge about the Spanish market.

In 2022, PMI sold 13.6 billion cigarettes and heated tobacco products in Spain, representing a growth of 3.2% compared to the previous year. The total sales of heated tobacco products reached 900,000 units. However, out of the 9 million smokers in Spain, only 300,000 use heated tobacco products.

Andolina said:

In Spain, there is still much work to be done to better understand Spanish consumers.

PMI's heated tobacco product IQOS has 25.8 million users worldwide. However, according to the Spanish Ministry of Health, there is no evidence to suggest that heated tobacco products are less harmful to health than traditional tobacco products.

It is reported that PMI not only sells IQOS in its "smokeless" product portfolio, but also includes electronic cigarettes, oral tobacco, and other products.

Reference:

The alternatives to traditional cigarettes account for only 5% of the revenues for the owner of Marlboro in Spain.