Japan Tobacco Steps Up Investment in Heated Tobacco Products

According to Nikkei Asia, Japan Tobacco will invest 300 billion yen ($2.25 billion) in its heated tobacco products (HNB), including 200 billion yen to market these heated tobacco products in international markets.

"Last year, we were unable to invest because there were not enough [heated tobacco] devices due to the semiconductor shortage," Japan Tobacco President Masamichi Terabatake was quoted as saying. "By 2023, our procurement was back on track, and compared with last year, we were able to secure more than double the supply volume for Japan."

Japan Tobacco (JT) plans to launch its new Ploom X device in more than 10 countries and regions this year, with coverage expanding to at least 20 new countries and regions by the end of 2024. The product is currently available only in Japan and the UK, and will make its debut in Italy this month.

To build brand awareness, JT will invest in pop-up stores and digital sales. It will also develop flavors tailored to the tastes of each market.

In the United States, JT has formed a joint venture with Altria Group. The partners will seek authorization from the Food and Drug Administration to bring Ploom to the U.S. market by early 2025.

Although JT's HNB division is currently operating at a loss due to upfront investment, the company expects it to turn profitable in 2028 driven by overseas growth.

JT will also invest in research and development, seeking to develop second- and third-generation Ploom X devices.

JT said global cigarette sales fell 1.5% last year. By contrast, according to Euromonitor International, the global HNB market grew 17% last year to reach $33.4 billion.