LONDON (Reuters) - British American Tobacco is optimistic U.S. President Donald Trump's new administration can tackle a vast market for illegal vapes in the United States, Chief Executive Tadeu
BAT CEO Sees Trump Administration Tackling Illicit Vapes
LONDON (Reuters) - British American Tobacco is optimistic U.S. President Donald Trump's new administration can tackle a vast market for illegal vapes in the United States, Chief Executive Tadeu Marocco said on Thursday.
CONTEXT/WHY IT MATTERS
Big tobacco companies like BAT say widespread sales of disposable, flavoured products lacking the regulatory authorisations required to be legally sold, are worth billions of dollars every year and are eating into their market share.
The U.S. Food and Drug Administration has granted authorisation to market to just 34 vaping products so far, from companies like BAT and Marlboro-maker Altria, which are fighting hard to rid flavoured disposable products lacking that licence from the market.
Across the industry, there is growing anticipation that Trump or others in his government could take some kind of action. But some established players also worry that changes could result in currently illicit players gaining legal access to the world's largest market for smoking alternatives.
KEY QUOTES
BAT's CEO Tadeu Marocco told journalists however he was hopeful any Trump Administration intervention would be positive for BAT:
"Hopefully with the new administration there is a new opportunity to think about enforcement."
"I think they will need to restore order... and actually I am optimistic that over time this issue can be addressed by the new administration."
BY THE NUMBERS
* BAT's cigarette volumes in the United States were down 10.1%, in part because of competition from disposable vapes
* BAT's vaping revenue in the U.S. was 0.8% lower for the same reason
* BAT estimated that the legal U.S. vaping industry declined around 9% while illegal sales grew
(Reporting by Emma Rumney; Editing by Tomasz Janowski)
