The Death of Vaping?
Some are starting to call vaping the “revolution that wasn’t”. Do declining figures indicate the beginning of the end for ecigs?
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by Dave Cross
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Panjiva, a global trade data site, recently posed the question: “Are eCigarettes burning out?” The raw data for imports to the States shows a sharp dip in demand from the last quarter of 2014 and throughout 2015. Imports do not reflect the products being made within the country or total sales, but the figures contrast sharply with the continued growth of the import of tobacco.
Financial analysts are concerned that this situation could be an indicator for a shift in the market and are advising their investment clients accordingly. Given the continued strengthening value of the U.S. dollar, leading to a reduction in the cost of items bought abroad, many experts are perplexed at this decline. Investing.com believe that these figures “may give us advanced warning of a pending slowdown.”
The logic goes that if vendors are buying in fewer products then they fear lower sales to come in the future. Panjiva predict a further fall in the importation numbers and wonder if this is the result of an increase in legislation being implemented or if this is a fad on decline.
Charles Sizemore argues that “given the aggressiveness of all levels of government towards tobacco products - everything from Washington DC down to the local neighbourhood association - we should have known it was just a matter of time before we saw an organized crackdown.” It is highly probable that vendors are running down stock in hand prior to the FDA announcing further regulations in June, action that will be mirrored by vendors in the UK with one eye on 2016’s implementation of the Tobacco Products Directive.
Sizemore explains that the biggest implication for this is that, although regulations could play into the hands of Big Tobacco, the electronic cigarette is not going to be the lucrative market tobacco companies hoped it would be. He has long argued that, as Big T has no durable foothold in the marketplace they are in a free-for-all with every other vendor, and this will only speed up the decline of the entire nicotine product market.
Techsonian mirror this news with the announcement that Electronic Cigarettes International Group has lost 6.42% of its share value against declining sales. This drop in value is more incredible considering it has just had a massive $41 million cash injection into the company to improve profitability. Such news, and advice to sell tobacco company stocks, must come as bad news to Big T that is still going all out to dominate the ecig market. Japan Tobacco has entered into an agreement to take over one of the leading ecig brands in the U.S. and is hoping to develop sales of Logic cigalikes at a global level.
In fact, there is only one investment website currently spinning good news for vapers; Seeking Alpha (SA) confidently state: “E-cigarettes are here to stay, and for many, they represent the future of smoking.” The positivity is limited though, SA believe: “Big Tobacco has positioned itself to gain massively from increased regulation of e-cigs, which would likely drive smaller competitors out of business, leaving only the giants with the money and lobbyist backing to get their products through.”
Dave Cross
Journalist at POTVDave is a freelance writer; with articles on music, motorbikes, football, pop-science, vaping and tobacco harm reduction in Sounds, Melody Maker, UBG, AWoL, Bike, When Saturday Comes, Vape News Magazine, and syndicated across the Johnston Press group. He was published in an anthology of “Greatest Football Writing”, but still believes this was a mistake. Dave contributes sketches to comedy shows and used to co-host a radio sketch show. He’s worked with numerous start-ups to develop content for their websites.
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