April 3, 2018
Japan Tobacco estimates that domestic cigarette industry volume will decline at a rate of approximately 17.5% in 2018. The forecast is a result of the rapid category shift from combustible cigarettes to Heat-not-Burn (HnB) products in Japan – the pace of which is unusual for any consumer good and historically unheard of within the Tobacco sector. One competitor reports a nearly 14% national market share in the fourth quarter of 2017 with its HnB product, an increase from about 7% in the first quarter. Furthermore, results from Sendai, Japan (where HnB initially launched and multiple competitive products are present) indicate that the heated tobacco category, in a very short period, appears to have taken a nearly 30% share of the tobacco (cigarettes plus HnB) market.