Trends and Regulations in Spain's E-Cigarette Market

The topic of electronic cigarettes has sparked much discussion and debate in Spain. With issues ranging from health and environmental effects to the emergence of numerous brands and models. One newly emerging market for e-cigarettes is Spain, where the industry is seeing increasing interest from both consumers and manufacturers. As various brands vie for a foothold in the Spanish market, attention has also turned to regulatory issues and the overall direction of e-cigarette development in the country.

According to data from Statista, the Spanish e-cigarette market is expected to reach €200 million in 2023, with 2.4 million users comprising 5% of the population. Open systems were the first to dominate the Spanish market, but disposable e-cigarettes quickly took over before the summer of 2022. What are the unique characteristics and trends resulting from this fluctuation in market? What is the regulatory role in this market?

During the electronic cigarette exhibition held in Madrid, Spain on June 3-4, 2FIRSTS, as the official media partner, conducted a visit and research of various exhibiting brand manufacturers, distributors, and local retailers to gain insight into the characteristics and trends of the Spanish market.

Disposable Products are on the Rise, but There is No Clear Leader Yet

In the summer of 2022, the disposable e-cigarette trend swept through the Spanish market. According to employees at Skyvap, an e-cigarette shop in Madrid, the hot sales of disposable e-cigarettes were driven by numerous English and American tourists who visited Spain last summer. Today, disposable e-cigarettes are still primarily consumed by tourists from these countries.

However, despite the booming market of disposable e-cigarettes, no brand has been able to maintain a dominant position for long. According to an employee of a hookah shop, there are many globally renowned disposable e-cigarette brands in the Spanish market, such as ELFBAR and LOST MARY, which dominate the British market, and HQD, which is a leader in Russian market. However, these brands have not yet become the irreplacable top players in the Spanish market as they have in their home turf.

According to Aleksejs, CEO of HQD Spain, HQD has the potential to become the top brand in the Spanish market in the coming years. He believes that not having an absolute market leader is actually beneficial for the industry as it allows for every brand to have an opporunity at finding their place in the market.

No Nictotine Products are "Born Out of Demand"

2FIRSTS discovered that zero nicotine (zero-nic) has a significant presence in the market, with almost all major disposable e-cigarette brands to include zero nicotine products in Spain. Famous e-cigarette brands ELFBAR and WAKA actually mainly sell zero-nic products in Spainish tobacco shops, ELUX also entered the Spanish market by introducing zero-nic products. HQD's Spanish distribution company shared that 25% - 30% of the sales of come from zero-nic products.

Why are Zero Nicotine Products Popular in Spain? 

In response to this question, several brands have provided their viewpoints.

Non-nicotine disposable vapes are not subject to regulation under the Tobacco Products Directive (TPD) of the European Union. The procedure for TPD notification for nicotine containing vapes usually takes more than 6 months. So, to quickly introduce one's brand into a market, brands may put up zero-nic products ahead of the 6 months long wait.

Compared to the restrictions placed on nicotine-containing disposable vapes, which are limited to 2ml, zero-nicotine products have another significant advantage. Under TPD zero-nic products are legally allowed on market with e-liquid capacity higher than 2ml. They can have capacity that are 5ml or even higher.

The zero-nic product does not contain nicotine, hence it could also attracted a large number of individuals who wish to experience vaping devices but do not want to get addicted, particularly young women.

Rody, the head of ELUX Spain, is not optimistic about the long-term development of zero-nic products. He believes that although current sales of zero-nic are good, they lack the important qualities of nicotine, which are the real reason for e-cigarettes to exist. In the future, he sees more potential in the development of products containing nicotine containing products.

In the UK market, where zero-nic vapes are becoming increasingly popular, there have been reports recently of nicotine being detected in these zero-nic products. In response to these incidents, some manufacturers who wish to remain anonymous have suggested that there may also be cases of nicotine containing vapes labeled as zero-nic vapes.

Open and Pod-Systems are on the Rise Along with Disposables

By 2021, open-system e-cigarettes have lost their dominant position in the Spanish market," said the manager of a hookah and vape shop, noting that the rise of disposable e-cigarette products has replaced the leading role of open-system products.

However, June, the EU Manager of VAPORESSO, an open-system brand under SMOORE, held a different opinion. According to June, the rise of disposable e-cigarettes has actually fostered the development of open-system products. "Although the market share of open-system products has been over shadowed by that of disposable products, their sales revenue is actually increasing."

For example, according to June, VAPORESSO saw its sales double from the previous year following the rise in popularity of disposable products. She mentioned that disposable products serve as an introduction for consumers and can also spark their interest in open-systems for better affordability.

According to Miette, a regular customer at local e-cigarette shop Vapemoniadas, most individuals who initially try disposable e-cigarettes will eventually switch to replaceable or refillable products because the difference in cost of these two options is as different as day and night. A disposable may last one day, but for the same price of e-liquids it could last for a month or so.

Vending Machines and Tobacco Shops

Upon arriving in Madrid, it was immediately noticeable that there are more tobacco shops in the area than electronic cigarette stores. "In 2019, there were around 7 or 8 electronic cigarette stores nearby, but now only 3 of us have survived," said a worker at Skyvap e-cigarette store, who also noted that the number of dedicated e-cigarette stores is decreasing.

Spain's electronic cigarette regulatory laws are also set to become increasingly stringent. There are predictions that within the next two years, e-cigarettes may be included in the tobacco transaction system. Juan, the head of the Spanish brand Olé, which produces disposable e-cigarettes, stated that they are already stocking their products in tobacco shops to be better ready for future regulations.

According to a set of data provided by the interviewees, there are 16,000 tobacco shops in Spain, with nearly half indicating a willingness to sell e-cigarettes. However, opening a tobacco shop in Spain is not an easy task, as Roberto, the Mevol Manager in Spain, explained. Spain has a tobacco state monopoly system, making the cost of opening a tobacco shop very high, ranging from hundreds of thousands to millions of euros, and each person can only open one.

Furthermore, 2FIRSTS also discovered that some tobacco shops have electronic cigarette vending machines outside, and many exhibitors at the trade show showcased their own e-cigarette vending machines. When asked why, it is because vending machines currently have no related regulatory policies and can directly sell electronic cigarettes, which is much more convenient than opening a store. There are 180,000 vending machines in Spain that sells tobacco products, that number is a several times higher than the numbers of tobacco shops around the country.

The inclusion of e-cigarettes in the tobacco system in Spain will depend on whether or not there is a change in political parties. Julio Ruades, the spokesman of Spanish Association of Electronic Cigarette Consumers (ANESVAP), stated that the continued presence of current political personnel will directly determine the regulatory direction of electronic cigarettes.

Julio shared news of the regional elections that took place at the end of May, stating that the ruling party (PSOE), which is supportive of banning e-cigarette flavors and incorporating e-cigarettes into the tobacco trade framework, has lost many votes in the recent provincial elections. Therefore, if the ruling party changes in July's general elections, the proposed e-cigarette laws will likely be put on hold or scrapped.

Background:

2FIRSTS is a media partner to the VAPEXPO SPAIN to work together in promoting the development and communication of the global electronic cigarette industry. This interview was made possible thanks to the interpreter Yang Zexuan provided by the host of Vapexpo-Spain.

Vapexpo Spain is the largest and most important vaporization industry exhibition in Spain, bringing together vape manufacturers, suppliers, retailers, and industry experts from around the world. Meanwhile, 2FIRSTS is a global vaporization technology media and think tank, focusing on market trends and hot topics in the field of vaporization, and committed to promoting global electronic cigarette industry information exchange and development through its media influence.

Click on the image below to view our special report on the VAPEXPO-SPAIN.