Japan Tobacco to Launch E-Cigarette in Japan

LONDON — Japan Tobacco is entering the electronic cigarette space with plans to roll out its Ploom Tech tobacco-based product in Japan next year.

According to Japan Today, Japan Tobacco has invested in expanding its production capacity for Ploom Tech tobacco capsules after it hit supply constraints in March following a test launch in the southern city of Fukuoka. The move comes as Philip Morris International gains ground in the vapor product arena in the country.

"Though we are not able to comment on the exact timing of the national launch in Japan due to the fast-changing demand, our intention is to expand, starting from the urban areas, step by step, from early next year," Yasuhiro Nakajima, vice president of emerging products, said on the sidelines of an investor meeting in London on Sept. 23.

The company will have increased its capacity by four times by the end of this year and 10 times by the end of next year, the report added.

Last month, Philip Morris International said its "heat not burn" tobacco product iQOS had captured close to 3 percent of the Japanese tobacco market, making inroads in a country where Japan Tobacco makes 40 percent of its profits, according to the news outlet.

The global market for vaping products was worth about $8 billion in 2015. E-cigarettes made with tobacco are still a small portion of the market and Japan Tobacco executives said they could not predict their ultimate potential, it added. 

The company has also introduced liquid-based e-cigarettes in markets including the United States and Britain, which together account for more than half the global e-cigarette market.

Japan Tobacco is the world's third-largest tobacco company and its tops brands include Winston, Mevius and Benson & Hedges.