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          1. Tobacco Manufacturing Industry Profile

            Report Page Length: 10-12
            Last Quarterly Update: 7/6/2020
            SIC Codes: 2111, 2121, 2131, 2141
            NAICS Codes: 3122
            Chapters Include:
            Industry Overview Trends & Challenges Industry Forecast
            Quarterly Industry Update Call Prep Questions Website & Media Links
            Business Challenges Financial Information Glossary & Acronyms
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            Excerpt from Tobacco Manufacturing Industry Profile

            Companies in this industry stem and redry tobacco and manufacture cigarettes and other tobacco products. Major companies include US-based Altria (owner of Philip Morris USA and UST), Philip Morris International, and Reynolds American (a subsidiary of British American Tobacco); China National Tobacco; UK-based British American Tobacco and Imperial Brands; and Japan Tobacco.

            Cigarettes are the most popular tobacco product; more than 5.5 trillion are consumed annually worldwide. Global revenue from cigarette sales, which approached $700 billion in 2016, will decline slightly by 2021, according to Euromonitor International. China, Indonesia, Russia, the US, and Japan are the world's largest cigarette markets in terms of volume sold. Per-capita smoking rates are highest in Eastern Europe and the Asia/Pacific region.

            The US tobacco manufacturing industry includes about 150 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $41 billion.

            COMPETITIVE LANDSCAPE

            Demand is driven by discretionary consumer spending and mitigated by awareness of the health effects of smoking. The profitability of individual companies depends on effective marketing. Large companies enjoy economies of scale in manufacturing and in their ability to offer wider ranges of products. Small companies can compete effectively through heavy discounting, through clever branding and packaging, and by exploiting niche categories such as pipe tobacco and additive-free cigarettes. The US industry is highly concentrated: the eight largest companies generate about 95% of revenue.

             
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