JT International - Competitors

JT International Competition

Now Viewing JT International's competition in: Tobacco Manufacture (primary)

Recent Developments

Percentage of Adult Smokers Declines - The proportion of US adults who smoke cigarettes has dropped below 20 percent for the first time since tobacco use rates began to drop in the 1960s, reports the Centers for Disease Control and Prevention (CDC). Some 19.8 percent of US adults, or 43.4 million people, smoked in 2007, compared to 20.8 percent a year earlier, according to the center's National Health Interview Survey released in November 2008. A key market for US tobacco manufacturers would get smaller if the trend continues.

Government Changes Could Trouble Tobacco - The election of a new US president and Congress could signal tougher times ahead for tobacco manufacturers. The 2009 political agenda will include pushing for an increase in federal excise taxes on tobacco products to fund an expanding State Children's Health Insurance Program, industry watchers say. Additionally, lawmakers are expected to enact measures allowing the FDA to regulate the tobacco industry.

More Lodging Goes Smoke-Free - The number of smoke-free hotels, motels, and other lodgings across the US has increased to 8,300 from about 2,300 in 2005, according to the American Automobile Association (AAA). A growing number of state and local governments have barred smoking in hotels, and some national lodging chains have voluntarily adopted no-smoking policies. Restrictions on smoking in hotels put pressure on US tobacco manufacturers by limiting the places their product can be used.

Competitive Landscape

Demand is driven by discretionary consumer spending and awareness of the health effects of smoking. The profitability of individual companies depends on effective marketing. Large companies have advantages in economies of scale in manufacturing and product loyalty. Small companies can compete effectively through heavy discounting, clever branding and packaging, and by exploiting niche categories such as pipe tobacco and additive-free cigarettes. The industry is highly capital-intensive: average annual revenue per worker for a typical company is $1.5 million.

Full Industry Overview For Tobacco Manufacture

Tobacco Manufacture Industry Forecast

from Hoover's/D&B subsidiary First Research

The output of US tobacco products manufacturing is forecast to grow at an annual compounded rate of 0.8 percent between 2008 and 2013.

Tobacco Manufacturing Growth Weakens

First Research forecasts are based on INFORUM forecasts that are licensed from the Interindustry Economic Research Fund, Inc. (IERF) in College Park, MD. INFORUM's "interindustry-macro" approach to modeling the economy captures the links between industries and the aggregate economy.