BAT plans new cigarette brands

MANILA, Philippines - Global tobacco giant British American Tobacco is looking to launch new brands, including a budget-oriented one, in the Philippines as part of efforts to increase its market share and tap a wider client base.

BAT produces famous selling brands Lucky Strike, Dunhill, Kent, and Pall Mall, which accounted for more than 30 percent of the group’s worldwide volumes in 2011 or 226 billion cigarettes.

It only sells Lucky Strike in the Philippines with total sales of a few million cigarette sticks last year.  

“We’re looking at introducing new brands.  We have Lucky Strike now but we’ll have multiple brands in the market as we go along.  Lucky Strike is quickly establishing itself in the marketplace.  We’re seeing an opportunity to bring in new brands here.  We may bring in a low-tier brand,” BAT Philippines general manager James Lafferty said in a briefing.

Lafferty said the introduction of new brands is also part of BAT’s commitment to invest around $200 million over a five-year period in the Philippine market  following  the passage of  the controversial sin tax bill.

Lafferty said the group is mulling the establishment of a manufacturing plant in the Philippines but noted that  nothing has been firmed up.

“We’ re certainly committed to stay.  We’re investing full speed ahead.  The $200 million investment could even go up should we decide to put up a manufacturing facility here,” Lafferty said.

Meanwhile, he said the company would continue importing products from Malaysia with Filipino leaf. “We will continue doing that while we study manufacturing options. We will manufacture here at some point in time but I don’t have a proposal yet,” the BAT official said.

The firm failed to hit its sales target of 150 million sticks last year but is hopeful it will perform better this year as it benefits from a level playing field with the enactment into law of the sin tax reform bill.

“Lucky strike is still in the launch phase, it’s still brand new and still with a 0.01 market share…At some point we’d like to move up. We’re a modest company with modest goals.  We hire good people, pay the right taxes and do the business right,” Lafferty pointed out.

With more than 200 brands in our portfolio and a significant global presence for over 100 years, BAT is the cigarette chosen by one in eight of the world’s one billion adult smokers. The group holds robust market positions in each of its regions and has leadership in more than 50 markets.