Bans, bans, bans!

[stevegmu]

Master Settlement Agreement back in '98(?). $200 billion over 25 years. (roughly and with caveats).

I beg to differ. Without sleuthing for facts, I'm guessing they make *a lot* more now than they did even 20 years ago. There are other major markets besides the U.S. All BT did was put more emphasis on peddling their wares elsewhere. (It's why the Greeks and Russians only live to age 29. )

Last I checked, most restaurants and bars no longer allow smoking, as per state or local ordinance. Not sure what that has to do with the settlement...
Really, in the US, BT makes more than before the bans, with adjusted dollars? Global profits have nothing to do with US legislation and prohibitions...

 

[EddardinWinter]

Last I checked, most restaurants and bars no longer allow smoking, as per state or local ordinance. Not sure what that has to do with the settlement...
Really, in the US, BT makes more than before the bans, with adjusted dollars? Global profits have nothing to do with US legislation and prohibitions...

But their immunity from lawsuits (part of the settlement) certainly has improved their bottom line....greatly.

Do you think it is coincidence that the only product on the market that meets the EU new e-cigarette requirements for "identical nicotine delivery per puff" is the Vuse from RJR? This product was released a few months prior to the regulations. It uses a proprietary cartridge and chip set up, so e-liquid must be purchased from RJR....almost like they knew this requirement was coming.

I bet we see that requirement again from other regulations.


Vuse
https://www.vusevapor.com/modules/FooterLinks/ProductFAQ.aspx?isMobile=true



Roaring thunderously via Tapatalk...

 

[stevegmu]

But their immunity from lawsuits (part of the settlement) certainly has improved their bottom line....greatly.

Do you think it is coincidence that the only product on the market that meets the EU new e-cigarette requirements for "identical nicotine delivery per puff" is the Vuse from RJR? This product was released a few months prior to the regulations. It uses a proprietary cartridge and chip set up, so e-liquid must be purchased from RJR....almost like they knew this requirement was coming.

I bet we see that requirement again from other regulations.


Vuse
https://www.vusevapor.com/modules/FooterLinks/ProductFAQ.aspx?isMobile=true



Roaring thunderously via Tapatalk...

Their bottom line has been hit hard by the taxes and regulations. That has hurt their bottom line far more than the settlement has helped it. I really don't know what influence they have within the EU. I gave up trying to understand the rationale the EU has for most of what it does for the 'good' of the people...

 

[EddardinWinter]

Also, here are a few criticisms of the settlement:

" Fellows within the Cato Institute, such as Robert Levy, assert that the lawsuit that brought on the tobacco settlement was instigated by a need to make beneficiary payments to Medicare recipients. Following the passage of laws that eliminated the tobacco companies' ability to provide evidence in court for their defense, the tobacco companies were forced to settle. The big four tobacco companies agreed to pay the state governments several billion dollars but the government in turn was to protect the big four tobacco companies from competition. The Master Settlement Agreement, they argue, created an unconstitutional cartel arrangement that benefited both the government and big tobacco."

and,

" For 40 years, tobacco companies had not been held liable for cigarette-related illnesses. Then, beginning in 1994, led by Florida, states across the country sued big tobacco to recover public outlays for medical expenses due to smoking. By changing the law to guarantee they would win in court, the states extorted a quarter-trillion-dollar settlement, which was passed along in higher cigarette prices. Basically, the tobacco companies had money; the states and their hired-gun attorneys wanted money; so the companies paid and the states collected. Then sick smokers got stuck with the bill."


That sounds a lot like collusion to me. The BT firms have immunity for selling a product proven dangerous in exchange for cash to the government. What does that sound like to you?




Roaring thunderously via Tapatalk...

 

[stevegmu]

If I were on their legal team, I would have manufactured a class action lawsuit in order to end the litigation and have a set, one time figure to pay.
Again, we are talking about the 1990's, when BT had far, for more influence than it has now. I trace the beginning of their demise to the end of the Winston Cup. Not that I am into NASCAR, but the end of that partnership was the shift towards demonization of smoking in the US. Once the blue collar pastime abandoned BT, the gates were open for the taxes and regulations...
Said settlement would never happen in today's climate...

 

[EddardinWinter]

You sure about that "bottom line hit hard"?

null
http://m.seekingalpha.com/article/1745692

"Smoking in the United States peaked in 1981 with approximately 640 billion cigarettes sold and had declined to 360 billion sold by 2007. It seemed regulation and increased public awareness had finally started to reduce the number of smokers. The anti-smoking lobby was beginning to win but the tobacco companies kept making money. The Altria Group (MO), then called Philip Morris, made $25.9 billion from domestic and international cigarette sales in 1992. Ten years later, annual sales had jumped to $47.6 billion, an annualized increase of 6.3% in an industry facing an almost mandated decline."

Selling fewer smokes, at a higher margin, in a softer market...what other products can say that? Was it magic? C'Mon, now, it's obvious BTs partnership with our government has lined both BT's and the government's pockets. Sounds like a mafia-style arrangement to me....


Roaring thunderously via Tapatalk...

 

[stevegmu]

I'm not talking about global sales, which have obviously increased. US taxes and regulations have nothing to do with international sales. In the US, increased cigarette taxes and regulations have hurt their business, not helped the bottom line.

 

[EddardinWinter]

PM revenues:

26 billion - 1992
48 billion - 2002
77 billion - 2012

Yeah, you are right, these guys are getting killed by the regulations. They will be shutting the doors any day now...

Guess what? They pay taxes on every dime of that revenue. So, who else has a vested interest in seeing those sales protected?


Edit: revenue is actually 77 billion in PMs annual report for 2012.



Roaring thunderously via Tapatalk...

 

[Gato del Jugo]

Altria -- the US part of the company that was once Philip Morris before spinning off the non-US biz -- is a publicly-traded company..

Meaning, their financials are well-known..


Revenue is flat these days, but at 26% net margin, they ain't doing too shabby...

MO Key Statistics | Altria Group, Inc. Stock - Yahoo! Finance


Here's the international Philip Morris biz, which experiences the same...

PM Key Statistics | Philip Morris International Inc Stock - Yahoo! Finance


Same goes for Lorillard...

LO Key Statistics | Lorillard, Inc Common Stock Stock - Yahoo! Finance


The old RJ Reynolds, while not as profitable, is still doing quite well, at 21% net margin...

RAI Key Statistics | Reynolds American Inc Common St Stock - Yahoo! Finance


Tobacco is still a cash cow -- even in 2014

 

[RogerWilco357]

Like they say about power and absolute power corrupts absolutely ...

 

[stevegmu]

PM revenues:

26 billion - 1992
48 billion - 2002
77 billion - 2012

Yeah, you are right, these guys are getting killed by the regulations. They will be shutting the doors any day now...

Guess what? They pay taxes on every dime of that revenue. So, who else has a vested interest in seeing those sales protected?


Edit: revenue is actually 77 billion in PMs annual report for 2012.



Roaring thunderously via Tapatalk...

Again, those are global sales. How have the smoking restrictions and increased taxes affected them in the US?
I'm not saying their revenue has not increased- it has, mostly due to expanding sales to offshore markets, not an increase in US based revenue.

 

[EddardinWinter]

Their bottom line has been hit hard by the taxes and regulations. That has hurt their bottom line far more than the settlement has helped it. I really don't know what influence they have within the EU. I gave up trying to understand the rationale the EU has for most of what it does for the 'good' of the people...

You still stand by this, then?

The taxes hit the consumers, not the tobacco companies. The taxes are charged, per pack, and paid by the consumer when they buy the smokes. BT couldn't care less about taxes, since ultimately the customer pays them. That's the beauty of the scam that was the Tobacco Settlement. They (BT) bought protection from the government. The consumers were the only ones left out, and they bear the brunt of the health costs and the taxes!

BT certainly likes getting immunity for selling their deadly wares. They don't ever have to worry about that liability again, or the vast legal expenses associated with that issue.

Regulations may have hurt them, but they have easily adapted. BT is not the toothless, weak industry you appear to want to paint them. Any industry doing this much business, paying this much in taxes, and making annual payments beyond it's taxes to the government has tremendous influence on that government and public policy. To say otherwise is absurd.



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[stevegmu]

You still stand by this, then?

The taxes hit the consumers, not the tobacco companies. The taxes are charged, per pack, and paid by the consumer when they buy the smokes. BT couldn't care less about taxes, since ultimately the customer pays them. That's the beauty of the scam that was the Tobacco Settlement. They (BT) bought protection from the government. The consumers were the only ones left out, and they bear the brunt of the health costs and the taxes!

BT certainly likes getting immunity for selling their deadly wares. They don't ever have to worry about that liability again, or the vast legal expenses associated with that issue.

Regulations may have hurt them, but they have easily adapted. BT is not the toothless, weak industry you appear to want to paint them. Any industry doing this much business, paying this much in taxes, and making annual payments beyond it's taxes to the government has tremendous influence on that government and public policy. To say otherwise is absurd.



Roaring thunderously via Tapatalk...

Yes, when taxes are raised on a product to the point that product becomes too expensive for some consumers, they look for alternatives, like stuff your own...

 

[Recycled Roadkill]

Yes, when taxes are raised on a product to the point that product becomes too expensive for some consumers, they look for alternatives, like stuff your own...

I have to agree on this point. A few years ago the cigarette tax in Texas went up a dollar a pack. I've bought less then ten packs of smokes in Texas since that time. I started buying 10 cartons of cigs at a time in Oklahoma saving about 10 bucks a carton. It was worth the trip which became a monthly adventure.

The overall cost of cigarettes was my main motivation for quitting and going to vaping.

 

[Gato del Jugo]

Yes, when taxes are raised on a product to the point that product becomes too expensive for some consumers, they look for alternatives...

Absolutely!

60% of cigarettes sold in New York are smuggled: report - Jan. 10, 2013

 

[EddardinWinter]

Yes, when taxes are raised on a product to the point that product becomes too expensive for some consumers, they look for alternatives, like stuff your own...

Facepalm away...your last statement is indecipherable.

Your position that BTs power, finances, and influence have been diminished speaks for itself. A truly unsupported perception. You mock many other posters here, yet time and again in this thread the facts and links counter your assertions.

Your "hurt bottom line" statement is without merit, and is refuted by the substantial data I have buttressed my position with. Meanwhile, you offer no data to support your positions at all.

It's silly to continue this discussion, unless you can actually back up your unsubstantiated claims.



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[Gato del Jugo]

It's silly to continue this discussion, unless you can actually back up your unsubstantiated claims.

Yeah, but I'm cutting him a little slack, since he's a member of the ProVarinati...

 

[EddardinWinter]

Yeah, but I'm cutting him a little slack, since he's a member of the ProVarinati...

I like Steve. He's just dead wrong on this issue, unless he has some data up his sleeve...it seems unlikely.



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[stevegmu]

The roll your own/stuff your own cigarette market became huge after what I call the Obama cigarette tax. This is when I started stuffing my own, mostly based on principle, however, and because I tried an organic, chemical-free- at least as far as additives, cigarette and loved it. BT tobacco was smart, knowing an increase in taxes would lead to a decrease in revenue, so raised their prices at the same time the first of the federal taxes were increased. Most smokers believed, and probably still do, that the substantially higher prices were solely a result of the tax increases.

Basic economics wil tell you when the cost of an item is raised significantly, fewer people will buy said item, or look for less expensive alternatives- like roll your own/stuff your own. I was a member on such a forum at the time, and panic ensued because politicians started looking at how to tax or even outlaw SYO/RYO. There was a loophole which kept tobacco really inexpensive- as low as $8 for a carton's worth. Said tobacco was labeled as pipe tobacco, which was taxed at a significantly lower rate. BT knew this, but could do nothing. Certain states were in fear of losing revenue from cigarette taxes so did enact strict verification laws for online sales as well as high taxes- like in NY.
Several years went by and nothing really happened, even though BT lost quite a bit of sales to people who rolled or stuffed 'pipe' tobacco, and even though states lost quite a bit of revenue in the form of cigarette taxes. This was a far bigger threat to BT than vaping is now, and they were powerless to do anything. Online sales continue and I can go down the street and buy cheap 'pipe' tobacco, should I please.


The data you provided is for international sales. I would like to see a spreadsheet showing US sales before and after the restrictions and taxes, but simply don't have the time to do the research.

I also knew Phillip Morris' influence has waned to insignificant when the smoking restrictions passed in Virginia, of all states, where I spent most of my adult life...

 

[DavidAmonettNashville]

The roll your own/stuff your own cigarette market became huge after what I call the Obama cigarette tax. This is when I started stuffing my own, mostly based on principle

. I was a member on such a forum at the time, and panic ensued because politicians started looking at how to tax or even outlaw SYO/RYO. There was a loophole which kept tobacco really inexpensive- as low as $8 for a carton's worth. Said tobacco was labeled as pipe tobacco, which was taxed at a significantly lower rate.

I also knew Phillip Morris' influence has waned to insignificant when the smoking restrictions passed in Virginia, of all states, where I spent most of my adult life...

I was part of the whole RYO/SYO deal too...I had a bunch of units over the 6 years but the best by test was my T-2...