US cigar market as a whole has been gently burning down

[El Presidente]

The following doesn't pass the "sniff test" for me, but I could be wrong. For those with some US industry perspective, chime on in 

 

22% dip in cigar shipments since the takeover. Indeed, the US cigar market as a whole has been gently burning down, with sales down ~23% in 2023 relative to the pandemic high of 2021.

Tobacco giant Philip Morris might sell its cigar business, as it works toward a smoke-free future

Cigar sales lit up during the pandemic, but have faded since.

Claire Yubin Oh

4h

Marlboro owner Philip Morris InternationalPM $158.38 (1.99%) is considering a potential sale of its cigar business in the US as the company continues to shift toward its smoke-free products. The tobacco maker is looking for over $1 billion for its cigar unit, per Bloomberg.

Putting out its cigar business isn’t entirely surprising — the division came almost as an add-on when it acquired Zyn maker Swedish Match to focus on smoke-free products, seeing a ~22% dip in cigar shipments since the takeover. Indeed, the US cigar market as a whole has been gently burning down, with sales down ~23% in 2023 relative to the pandemic high of 2021.

 

Sherwood News

Stubbing out 

As sales of cigarettes continue to steadily drop, tobacco companies have long been searching for something to light up their sales figures. For Philip MorrisPM $158.38 (1.99%), while traditional combustible products still take up a large part of its earnings, the company’s growth is now mainly driven by its smoke-free alternatives like IQOS and Zyn pouches, which bring in about 40% of the company’s total sales as of the latest quarter.

One bright spark in the market is high-end, handmade cigars — a trend which the machine-based cigar maker Philip Morris is on the wrong side of.

[wjs]

This looks like the US wine market (unfortunately).

[LordAnubis]

Looking forward to the cheap deep discount cigars 😁 . While the statistics are pretty suss, I think getting back to old times is a pretty good place to be.

[VeguerosMAN]

Wut? Is this a joke? Philip Morris and Cigars???? 

[SCgarman]

7 hours ago, VeguerosMAN said:

Wut? Is this a joke? Philip Morris and Cigars???? 

I have no idea what "cigars" are under the Philip Morris umbrella? Certainly none of the premium NC cigar makers. Maybe the machine made drug store rubbish?

[VeguerosMAN]

7 hours ago, SCgarman said:

I have no idea what "cigars" are under the Philip Morris umbrella? Certainly none of the premium NC cigar makers. Maybe the machine made drug store rubbish?

I think the reporter meant cigarettes.

[zeedubbya]

Doesn’t Phillip Morris now own Swedish Match, which owns at least General Cigar, maybe even STG? Pretty big business there I imagine, but maybe I am wrong?  

[BoliDan]

6 hours ago, zeedubbya said:

Doesn’t Phillip Morris now own Swedish Match, which owns at least General Cigar, maybe even STG? Pretty big business there I imagine, but maybe I am wrong?  

Ugh. General Cigars. Nothing lost there. Maybe people are waking up that other brands have more to offer for similar costs.

[mikejh]

6 hours ago, BoliDan said:

Ugh. General Cigars. Nothing lost there. Maybe people are waking up that other brands have more to offer for similar costs.

NC Punch and LGC are good cigars, the rest I could do without.

[Mr. DD]

Unfortunately I don’t doubt it. I believe the current smoking cessation movement in the U.S., coupled with a generation gap is killing the U.S. cigar market. 

[Çnote]

PM hasn't owed General. Swedish Match spun off STG before the acquisition.

I am unsure what cigars are owned by PM, but wanted to at least throw water on that.

[VeguerosMAN]

C'mon folks, it is written by some amateur reporter. I think she meant cigarettes, not handmade cigars.

[Chitmo]

Well, I can tell you personally that with the whole thing with the guy putting taxes on stuff from places, I’ll be sticking to Cubans for the foreseeable future. 

[charlieminato]

PMI bought Swedish Match in 2022: https://www.pmi.com/media-center/news/PMI-progresses-toward-sole-ownership-of-swedish-match

PMI is trying to get rid of Swedish Match's machine-made cigar business, which includes brands like Game and White Owl. Swedish Match exited its stake in STG (General, Cigars International) in 2017. 

The chart above is referencing machine-made cigars. Premium cigar imports have never topped 500 million units, so nearly a rounding error compared to the machine-made volume.