Jim Cramer addresses the recent pain in cigarette manufacturers' stocks and shares his outlook on the tobacco business.
Vaping decimating cigarette industry and could get worse
Vaping decimating cigarette industry and could get worse
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The underlying problem with this news is the states rely on the settlement money, which is based on sales. The settlement dollars decrease, the states can't grasp the concept of decreasing revenue and live within their means. Solution? Tax and regulate e-cigs.
Are e-cigs not yet regulated in your country?
No 2ml tank limit ? No 10ml e-liquid-bottle limit? No 20mg/ml nicotine limit?
No limits on tank sizes, purchases of 100% nic, or bottle sizes. Taxes are another story. Many states are taxing e-liquid at the same rates, if not above, tobacco products.
True they already are here. California added a 65% tax on the wholesale level in July of 2017 for ejuice and other non cigarette tobacco products (snuff, rolling tobacco, cigars, etc). This includes the vape devices if they are sold with nicotine. This is charged the distributor on the wholesale price and passed on in the overall cost so that consumers don't know they are paying a 65% tax along with a 7.75% sales tax. They also jacked up the tax on cigarettes by an additional $2 per pack.
And of course now the city wants an additional tax on them too.
Lucky for me I mix my own juice and stocked up before then.
Yep, the states are not happy with their "revenue" decrease. Their solution will be to tax vaping. Quite frankly, I'm surprised it took this long.
Unfortunately, one of the "downsides" of adopting an early technology is that you get to enjoy it without interference. As it gains popularity, it becomes a commodity to be manipulated, just as tobacco was.
Also, I remain unthrilled by the idea of a tax, and made sure to prepare myself for what I consider even worse: both regulation AND taxation, and the FDA is headed there.
If the solution winds up being BETTER than limiting a tank size to 2 ml, I will be pleased. I am also QUITE prepared for whatever comes next and etc, because make no mistake, any diminishing "revenue" from smoking will be more than fully made up with by taxing and regulating vaping.
So yea, we are "currently" more fortunate than MANY countries, but this state is unlikely to persist forever.
And, we still should be converting smokers, too.
:Anna
Unfortunately, one of the "downsides" of adopting an early technology is that you get to enjoy it without interference. As it gains popularity, it becomes a commodity to be manipulated, just as tobacco was.
Also, I remain unthrilled by the idea of a tax, and made sure to prepare myself for what I consider even worse: both regulation AND taxation, and the FDA is headed there.
If the solution winds up being BETTER than limiting a tank size to 2 ml, I will be pleased. I am also QUITE prepared for whatever comes next and etc, because make no mistake, any diminishing "revenue" from smoking will be more than fully made up with by taxing and regulating vaping.
So yea, we are "currently" more fortunate than MANY countries, but this state is unlikely to persist forever.
And, we still should be converting smokers, too.
:Anna
In my country everything is taxed, even water, milk and bread, while 'luxury' like whisky, wodka, cigarettes, cigars, etc. are taxed at much higher rates.
Nicotinefree VG-base, PG-base, flavors, and e-liquids have been taxed at the normal rates. But nicotinefree e-liquid is generally sold at the same price as e-liquid at f.e. 18mg/ml, cause the vendors find it too much work to calculate different prices for each nic-percentage.
I hope that all manufacturers will be so smart to also sell a 4ml glas + a chimney adapter (like for the Aspire X)
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The death of the tobacco industry would be a boon for humanity
I don't know the numbers, it is indeed true that many of the tobacco companies are working on stuff, but they're years behind the curve. Also, I'm fairly certain that Phillip Morris was SURE the USA would allow their "heat not burn" product to gain a huge market share. They were roundly dismissed, and they spent SO MUCH in developing that thing. I think the businesses that were really vape only from the start are light years ahead most gas station cigalikes. I think there is a market share, but I don't believe that overall, tobacco companies are "ahead" in the vape market.
I kind of get the sense that either the FDA wants to reign in BOTH vaping and smoking, in different ways. If they go the way of the closed, tobacco flavored pod, then tobacco companies may have a chance... In the USA at least, of getting a reasonable market share, but ATM (and the Juul got popular, I think, prior to being partially purchased by big tobacco, IIRC).
So, I'm not entirely certain "how much" market share overall, cigarette vape products own, worldwide. It would be interesting TO know, but I'm not sure big tobacco is currently ahead.
I think if anything, they are cursing themselves for not going to Heat not Burn in the 70s. They considered it, and felt there would be too much "pushback." If they had gone ahead, vaping AND smoking would not be coexisting the way they are now, IMO.
Anna
I kind of get the sense that either the FDA wants to reign in BOTH vaping and smoking, in different ways. If they go the way of the closed, tobacco flavored pod, then tobacco companies may have a chance... In the USA at least, of getting a reasonable market share, but ATM (and the Juul got popular, I think, prior to being partially purchased by big tobacco, IIRC).
So, I'm not entirely certain "how much" market share overall, cigarette vape products own, worldwide. It would be interesting TO know, but I'm not sure big tobacco is currently ahead.
I think if anything, they are cursing themselves for not going to Heat not Burn in the 70s. They considered it, and felt there would be too much "pushback." If they had gone ahead, vaping AND smoking would not be coexisting the way they are now, IMO.
Anna
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