JT’s Ploom X is leading the company’s expansion plans for its heated tobacco products in overseas markets. Photo credit: Japan Tobacco International
Japan Tobacco (JT) will invest ¥300 billion (US$2.25 billion) over the next three years to expand its heated tobacco stick products, with ¥200 billion set for marketing the sticks outside of Japan, reports Nikkei Asia.
In an interview with the publication, Japan Tobacco president Masamichi Terabatake said “Last year, we couldn't make the investment because there were not enough [heated tobacco] devices due to the semiconductor shortage. For 2023, we are back on track for procurements, and we are able to secure more than twice Japan's supply volume compared to last year."
Terabatake added that most of the ¥300 billion investment will be the initial costs of product rollout into new countries.
JT’s Ploom X heated tobacco product is currently sold only in Japan and the UK with plans to launch in Italy this month. JT aims to rollout Ploom X in more than 10 countries this year reaching at least 20 countries by the end of next year. JT also recently formed a joint venture with Altria Group to sell its heated tobacco products in the US market. By early 2025, the partners hope to submit an application to the Food and Drug Administration for the approval of Ploom.
JT will invest in digital sales and pop-up stores to build brand recognition as well as develop flavors to suit the preferences of each market. JT will invest in r&d as well, to develop the second and third generations of Ploom X devices.
JT anticipates its heated tobacco segment to turn a profit in 2028 on overseas growth.