Home Business News British American Tobacco embarks restructuring

British American Tobacco embarks restructuring

by LLB Editor
12th Sep 19 9:33 am

The regulatory pressure on the tobacco industry just dialled up a notch as the unpredictable Trump administration announced plans to ban flavoured e-cigarettes.

“This overnight development rather overshadowed news of a restructuring at British American Tobacco this morning,” according to AJ Bell’s Russ Mould.

“The move comes amid fears of a public health crisis among young people in the US linked to vaping.

“Falling numbers of smokers and increasingly strict rules in developed economies have seen tobacco manufacturers turn their focus to so-called next generation products such as e-cigarettes for future growth.

“What’s being announced across the Atlantic could see those plans go up in smoke, particularly given the size of that market. After all, it’s not just the young who opt for flavoured vaping products.

“On the flipside, it could reduce the competitive threat to the likes of British American Tobacco and its UK-listed rival Imperial Brands from US upstart Juul which has faced criticism for chasing a youthful audience with its marketing.

“And alongside British American Tobacco’s unveiling of 2,000 job cuts, as the business looks to cut out layers of management, is a reaffirmed commitment to reinvest the savings in the expansion of ‘new categories’ of product.  

“Today’s announcement represents a bold first step for new chief executive Jack Bowles, but he must hope the crackdown on vaping doesn’t see his growth ambitions run out of puff.”

 

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