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The global market

Trends affecting our industry

The global tobacco industry sells around 5,600 billion cigarettes each year.

The value of the global tobacco market is estimated at £450-£500 billion.

The global tobacco industry continues to be a substantial contributor to the economies of many countries and the livelihoods of millions of people across the globe, both directly and indirectly.

The future

Generally speaking, we think that individual smokers will consume fewer cigarettes each and smaller percentages of populations will smoke. While cigarette sales in developed countries continue to decline year on year, sustained volume growth is widely predicted in emerging markets, driven by population growth and increasing disposable income. As a result, the overall value of the tobacco market continues to increase.

The overall value of the tobacco industry is expected to continue growing in the future. The resilience of the industry is underlined by the continued year-on-year net revenue growth, at constant rates of exchange.

However, regulation of the industry also continues to increase. This includes the introduction of plain packaging in Australia, graphic health warnings on packs, tougher restrictions on smoking in enclosed public places and some bans on shops displaying tobacco products at the point of sale.

Excessive regulation often has unintended consequences. Measures such as retail display bans and sudden increases in excise rates can distort competition among tobacco companies and, in some cases, may result in consumers switching to cheaper, illegally trafficked products. Sound regulation is important in the tobacco industry and, where it is developed with all stakeholders involved, it can help to ensure an orderly marketplace that serves the interests of both consumers and governments.

Next Generation Products

The combustible market is likely to be the mainstay of the industry’s profits for some years to come, but Next Generation Products, such as Vapour Products (e-cigarettes) and Tobacco Heating Products, are constantly advancing, both in terms of technology and market growth.

Growth in these products continues to be strong. 2015 estimates place a value of US$8 billion on the global vapour market, according to data from Euromonitor International. That growth trend is expected to continue through to 2020. Vapour Products (e-cigarettes) are estimated to account for the majority of that growth.

We are BAT

We are proud of our heritage and of our continuing success today – and we are excited about our future. Read We are BAT to learn more.

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