Tag: ecigintelligence

Solid Expectations

Credit: TAW4
ECigIntelligence predicts that the global vaping market grew by almost $2 billion last year.
By Freddie Dawson
Further regulatory restrictions on e-cigarettes are expected, but these will not prevent the global vaping market from continuing to grow in 2024, ECigIntelligence predicts. The trend is distinctly toward tightening controls on vaping products. Just eight of the nearly 60 countries and regions tracked by ECigIntelligence’s Policy Radar have a positive outlook on the political climate when it comes to alternatives to conventional cigarettes.
Yet despite this, ECigIntelligence sees the overall vaping market still growing by almost $2 billion between 2023 and 2024.
So notwithstanding increased regulation in many markets, there is still enough demand for alternatives to traditional cigarettes to fuel growth. Perhaps it is important to put that growth into context. An increase of just under $2 billion (from $26.4 billion to a predicted $28.3 billion) is the smallest rise not impacted by Covid-19 in the overall global market since the increase from 2016 to 2017.
The much newer, less established heated-tobacco market is now expected to overtake vaping with our sibling site TobaccoIntelligence predicting the heated-tobacco market will reach an estimated $28.6 billion in 2024.
So while there is still growth in vaping, it is by a lesser amount than it has been (particularly when viewed as percentage growth of the existing market). And other alternatives fueled by the seemingly limitless resources of Big Tobacco companies are quickly overtaking.
This makes 2024 something of a pivotal year for vaping, with important elections coming up in existing markets—such as those for members of European Parliament (MEPs) as well as contests in Belgium, India, Indonesia, Mexico, South Africa, South Korea and Taiwan—two of which could potentially be crucial for the future of the global vaping market.
Europe: Elections, Directive Revisions and Developments
Clearly, EU elections, covering the majority of European markets as they do, could have a massive impact on the future of vaping. However, their very multi-country nature makes them difficult to predict and influence—particularly on issues such as tobacco control, which would be a relatively minor campaigning point for the vast majority of politicians running.
Nevertheless, there is a chance a milder outlook on alternatives to conventional cigarettes will emerge, with right-wing/centrist parties such as the European People’s Party, European Conservatives and Reformists Party, and Identity and Democracy Party polling well.
These groups are less likely to support strict regulation, which would—at the least—maintain the status quo at a significant time for nonsmoking nicotine products as both the EU Tobacco Products Directive (TPD) and Tobacco Excise Directive (TED) will be revised.
For example, ECigIntelligence believes it unlikely a centrist/right-leaning EU would support a policy like banning all nontobacco flavors in vaping products. But given the MEP elections, ECigIntelligence does not believe much progress will be made on advancing policies in the TPD and TED.
Outside of elections, there are also a variety of other proposals expected to see significant developments through 2024, particularly in the areas of flavor bans and plain packaging as—in a continuation from 2023—fears over youth uptake of e-cigarettes continue to rise in more jurisdictions.
Focus on Australia Under Labor Government
In Australia, an overall new tobacco plan is also being drafted with the recently elected Labor government now taking control. Labor is thought to have a more skeptical view on the benefits of nonprescription nicotine products in smoking cessation, which could change how the country’s already delayed tobacco plan tackles these products.
This means that new regulations, such as a proposal to bring in plain packaging and a flavor ban for vaping products (regardless of nicotine content) as well as heated-tobacco products, could be adopted. Health warning requirements for vaping products are envisaged as well, and a ban on disposable vaping products is also expected to be in the bill.
Further measures could also be taken, such as a prohibition on the import of nicotine-free e-cigarettes (and limiting their sale to pharmacies only). However, there may be a chance conditions for prescribing e-cigarettes are eased—though that would be poor solace in comparison to the stringency of the other proposals.
Flavor Bans and Other Global Regulations
We could also see other countries enacting their own flavor bans. For example, Slovenia is expected to make such a move in 2024 while a proposal is under discussion in Canada that would limit e-liquid flavors to tobacco, mint and menthol.
ECigIntelligence thinks it is very likely that the Canadian ban will be approved, given it is government-backed and the measures proposed would not be considered controversial among the wider voting population. However, as it is still early stages in the formulation of the proposal, a date for when it would come in is not yet predictable.
Dutch authorities could move to introduce plain packaging—though it is unlikely the measure would enter into force in 2024 as it currently is only an adopted motion to take action.
The Netherlands is also looking at implementing retail regulations such as a registration obligation for all points-of-sale, which would be introduced in 2024. And, eventually, a generational ban on vapor products could be brought in.
A proposal to ban the sale of tobacco and related products, including e-cigarettes, in supermarkets as of July 2024 is expected. Sales will still be allowed after that at fuel stations, in convenience stores and in specialist shops. An effective date for the measure is not yet final. Entry into force is subject to its passing through the upper and lower houses of Parliament, which has not happened yet but is thought to be likely.
Ireland is also looking to limit the sales of vaping products. There, government officials will consider a ban on disposable vaping products in 2024. Results of a consultation showed almost 85 percent of participants supporting a ban. Such a move also appears to enjoy some government backing, with ministers expressing lukewarm support. However, such a move would have to be agreed on by government coalition members, and it may run into hurdles from EU single-market rules.
It will be interesting to see how these measures impact 2024 market estimates, such as those in Australia (expected to increase around $72 million to $478 million), Canada (expected to rise $50 million to $757 million), Ireland (only growing $4 million to $128 million) or the Netherlands (expected to fall $17 million to $160 million)—if they do indeed go forward in 2024.
Disposables are Still Big, China Losing Ground
It should be noted that disposables are the primary—and sometimes sole—category driving growth, so how regulation goes in 2024 is crucial to how growth in the overall vaping market develops. Intense media coverage of youth uptake and environmental issues is expected to continue and probably increase in most cases—also doing the market few favors.
Already, two major markets have announced bans on disposable products with both France and the U.K. moving forward with the intention to enact regulations to prohibit their sale.
Details on how the bans will be implemented as well as exact timescales remain light. In the U.K., the intention is for a ban to come into effect in 2025. But with an unpopular government, looming elections and other priorities, whether such a deadline will be made—or any deadline at all for that matter—is open to speculation.
In France, more details are clear as a bill has been approved by the country’s senate. Vaping products that cannot be refilled or are powered by a nonrechargeable battery would be prohibited under the new law, although no date for when the ban will come into effect has yet been announced. And the law must still face EU scrutiny on issues such as freedom of movement of goods.
A 2021 attempt by Belgium to ban disposables was met with a negative opinion from the European Commission. This was because the EU TPD—still in force, although currently under revision—prevents member states from prohibiting or restricting “the placing on the market of tobacco or related products, which comply with this directive.”
It seems unlikely that the European Commission could come up with a different opinion on a disposable vape ban in France, putting the plan still in the realms of uncertainty.
Nonetheless, ECigIntelligence expects to see a significant increase in the number of pre-filled and open pod category product launches as companies start to develop pod versions of disposable devices in line with incoming regulations in areas such as battery waste.
This will lead to some growth in user numbers in these categories—though the majority of that will only be down to cannibalizing off existing disposable category numbers.
Regulations are also likely to have an impact on the supply side of the market in 2024, with countries like Indonesia, Vietnam and Malaysia gaining importance in the area of hardware manufacturing.
This could potentially lessen the reliance of the sector on Chinese manufacturing—though it should be noted that the opinion of Chinese industry members is that such growth is more overspill from a crowded Shenzhen manufacturing scene rather than wholesale relocation of business to other markets due to factors like increased domestic regulations and duties in China.
Freddie Dawson is the managing editor for news at ECigIntelligence, a provider of detailed global market and regulatory analysis, legal tracking and quantitative data.

March 4, 2024
U.S. Regulators Struggle With Flavored E-liquid Rules

By Timothy S. Donahue
The vapor industry continues to face several regulatory challenges. One of the most challenging of those is the seemingly never-ending battle against flavor bans for e-liquids. As most any vaper will tell you, flavors are instrumental in keeping former smokers from returning to combustible cigarettes. However, flavors are also what many industry regulators and anti-vapor advocates say lure youth to try vaping.
During Vape Live, a three-day virtual trade show and seminar hosted by Ireland-based Vapouround magazine, flavors and flavor bans in the United States, the world’s largest vapor market, were trending topics. Carlo Infurna Wangüemert, a vapor market analyst with ECigIntelligence, a regulatory research resource for the e-cigarette and tobacco alternatives industry, discussed recent market trends and the factors that are influencing the U.S. vapor market.
Wangüemert said that several factors are affecting the U.S. market: the e-cigarette or vaping use-associated lung injury (EVALI) scare, the Covid-19 pandemic and the U.S. Food and Drug Administration’s (FDA) premarket tobacco product applications (PMTAs). He said that Covid-19 didn’t impact market growth as much as it impacted consumer behavior.
Yael Ossowski / Credit: Consumer Choice Center
“We’ve seen a reduction of purchasing occasions and an increase of basket sizes [during the Covid-19 crisis],” he said. “We’ve also observed consumers buying a lot before the crisis in order to have enough stock in case of lockdowns, and it might also have affected the supply side as many independent shops had to close or have suffered an important drop of sales.”
Concerning supplies, Wangüemert sees the PMTAs drastically reducing the amount of variety on the market as many brands will try to keep their offerings as simple as possible. Before the FDA’s ban on prefilled flavored vape pods, those products represented half of the U.S. vapor market. Now, there is a rise in disposable e-cigarettes and refillable pod systems, according to Wangüemert. He said that this has led to several innovations in flavor output, such as better coils in open pod systems.
“Basically, hardware manufacturers are trying to develop new features and improving the functionality of their devices to make them small but complex enough to cover all vapers’ needs,” said Wangüemert, citing innovations that allow vapers to change temperature or change from mouth-to-lung to direct-to-lung with just one button as examples.
Refillable pod systems are the fastest-growing trend in the vapor industry, according to ECigIntelligence data. This is because they offer a larger selection of flavored e-liquids. Prefilled pods, however, are dropping because the only available flavors, tobacco and menthol, generate less complexity.
“Prefilled pods … show fairly well how regulation can have an impact on the market,” he said. “This ban is fully enforced online as only those two flavors are offered currently. We’ve observed an ongoing drop in the complexity of their flavors. Tobacco is [now] probably the most important flavor in prefilled pods.”
The U.S. market has also seen a surge in nicotine strengths, brought on mostly by the growing popularity of nicotine salts. Wangüemert said that nicotine salt-based e-liquids have been continually gaining ground during the last three years to the detriment of freebase liquids. “However, it is also interesting to point out that the average nicotine strength of nicotine salts is slowly going down,” he said.
Fruit flavors are also steadily rising in the U.S. market, according to Wangüemert. He said that fruit e-liquids, dessert and candy flavors all consume the Top 5 positions in flavors for e-liquid sales in 2020. “For the fruit category, which is mainly tropical fruits, mainly mango, are the ones helping the most in the growth of that category,” he said, adding that beverage flavors are also growing quickly, with lemonades experiencing a substantial amount of growth. “This might also be linked to the popularity of fruits, as lemonades are likely to contain them,” he explained.
Carlo Infurna Wanguemert / Credit: ECigIntelligence
Looking at tobacco and menthol flavors, Wangüemert explained that e-liquids containing tobacco generally have tobacco as the main flavor. However, menthol is much more popular as a complement to other flavors, such as fruit.
“Only 13 percent of the products that contain menthol have menthol as the main flavor. But [for] the other 87 percent, menthol is a complement or a cooling agent, being particularly popular in the fruit category,” he said. “Of course, these 87 percent of e-liquids that contain menthol that do not have it as the main flavor are more subject to potential bans than menthol-only flavors, which have been already excluded. However, our 2019 vape shop survey points out that menthol and tobacco represent just a small percentage of vape store revenues, meaning that flavor bans at the state level or even the consequences of the PMTA might strongly reduce their income and the vaping market in general as the offerings and variety of e-liquids were strongly reduced.”
Also speaking during Vape Live, Yael Ossowski, deputy director for the Consumer Choice Center (CCC), a consumer advocacy group, said that flavor bans in many U.S. states have had a major impact on the growth of the vapor market. States with strict flavor bans have seen major declines, with many vapers in those states returning to combustible products.
This prompted his organization to rank states by vaping regulations and the impact those regulations had on the vapor market. The group looked at how all 50 states confronted flavor restrictions, taxes and whether the state allowed for online sales. The CCC gave each state a number of points depending upon how much consumers were subject to the criteria. States that scored between 0–10 points received an F, 11–20 points received a C and 21–30 points received an A.
The states best suited for vaping were colored green on the corresponding chart while the worst states were colored red and middle-ground states were colored yellow. “For green states, we’ve got South Carolina, Georgia; we’ve got Iowa, Virginia, Florida, Texas and Oregon. You’ll notice, obviously, the red states, the places where we’re dealing with partial flavor bans, high taxes, shipping restrictions, there’s six of them.
Places like California, New York. You have New Jersey, Massachusetts, Rhode Island and Illinois,” said Ossowski. “Now we have our states in yellow. These are places that had a flavor ban in the past, and perhaps they’ve gotten rid of it, or it has not yet come into force. You have some taxation. It’s probably a bit more moderate than definitely those red states. And it has fewer shipping restrictions. People are able to order their vaping products online.”
One of the worst states, New York, has a tax rate of 20 percent of the retail price. Online sales are banned and all flavored products, except tobacco and menthol, are banned. These states, with low rankings, are also prone to other negatives for the vapor market, such as a growing black market, according to Ossowski.
California also has a statewide ban that is supposed to go into effect on Jan. 1, 2020. California also has several cities, such as San Francisco, that have banned vapor products entirely. It should be noted that, in California, flavor bans typically are only focused on nicotine vapor products, not marijuana vapor products. This is especially puzzling since the U.S. Centers for Disease Control and Prevention (CDC) has stated that the EVALI lung disease scare was caused by black market marijuana vapor products, not nicotine products.
“There is a lot of work that has been done by some very enterprising young journalists that kind of details everything with the black market when it comes to flavored vaping products. And that’s only just now burgeoning up in New York,” Ossowski explained. “There could be a lot more on this. We’re going to see. There’s not the biggest mainstream coverage on this.”
Credit: Consumer Choice Center
One of the main reasons that the CCC compiled the data and ranked the states is that the consumer group doesn’t want other states to follow behind states like California and Illinois by banning or restricting flavored vapor products. Ossowski said that these bans are detrimental to public health.
“It’s very dangerous. And in a way, by making it more expensive and pushing people often to the illegal market, not only are you seeing your price go higher, you’re also making it more difficult for people to acquire the products that they have transitioned away from tobacco to use. And we thought we’d actually be saving their lives and improving their lives. But what we see more often than not is that legislators make it harder,” he said. “They make it more difficult, and they actually put way more cumbersome barriers in the way so that you and I cannot access those products. We really do need to concentrate on laws, on policies, on studies, on figuring out who are the legislative champions that we can turn to in state legislatures or in the federal bureaucracy to be able to ensure that we have better laws that will enable harm reduction, that will enable us to continue to have vaping products for sale.”
December 14, 2020
Retail Experience
The European e-cigarette market is estimated to be worth €3.8 billion, and 3.1 percent of adults smoke e-cigarettes. The specialized vape shops are the prominent distributor. These were the major facts shared by Stavroula Anastasopoulou, senior market analyst for ECigIntelligence, a data provider for the global e-cigarette industry.
Speaking at TABEXPO, a vapor and tobacco trade show that was held in Amsterdam in November, Anastasopoulou gave an overview of the e-cigarette market and the future of the vapor sector, which has been impacted by strict regulation and the U.S. health warnings regarding vaping black market THC. About 70 percent of the EU market is e-liquids, according to Anastasopoulou.
“This is due to price differences and frequency of use. The EU market is small compared to the combustible market, which was estimated to be worth more than €100 million in 2017,” she said. “E-cigarette market growth, however, has been relatively steady.”
The EU vapor market is concentrated in five markets that make up much of the EU segment (an estimated 80 percent). The U.K., France, Italy, Germany and Poland all exhibit different growth patterns as well. “The U.K. takes up a third of the whole market (€1.2 billion) and is one of the fastest growing markets in the world,” according to Anastasopoulou.
Italy looks more optimistic as online channels are opening and a large e-cigarette tax has been placed on hold. Anastasopoulou said she expects the negative vaping news coming from the U.S. to affect the overall EU market. However, she still estimates the EU e-cigarette market to be €5.1 billion in 2022, which is 30 percent higher than its current value, with an estimated 10 percent yearly growth rate.
Specialized vape shops are the preferred distribution method in the U.K. with 50 percent of the market. “We believe that 30 percent of the market comes from traditional retail, and that segment has been growing over the past year,” says Anastasopoulou. “There are now more independent brands (not affiliated with a tobacco company) moving into this channel.”
In Poland, online sales are officially banned, so that segment is very small. France and Italy have a similar split to the U.K. where vape shops hold 55 percent to 60 percent of the market, says Anastasopoulou. “Germany has a large online presence of about 50 percent while [brick-and-mortar] vape shops only hold 30 [percent] to 35 percent of the market. This is because the total number of vape shops is relatively lower than the other markets, but also the top online retailers are seeing more traffic than other EU countries.”
In general, Anastasopoulou expects future traditional retail sales to increase due to the growing popularity of closed devices, and more brands are expected to enter the channel. “We also expect online channels to suffer from more strict regulations. The vape shop channel is uncertain due to negative publicity from the U.S. as well,” she says. “Shops in France and Belgium are saying that they are experiencing lower revenues due to the health issues in the U.S., and shops in the U.K. are reporting 25 percent less revenue over the last month due to negative publicity.”
February 25, 2020