BAT to launch smoke-free cigarette in Korea

BAT’s tobacco heating device, glo / Courtesy of BAT Korea

By Lee Hyo-sik

British American Tobacco (BAT) plans to launch its smokeless cigarette, glo, in Korea in the second half of 2017 to catch up with its rival Philip Morris, which began selling its IQOS here Monday.

With the IQOS attracting keen attention from local smokers, BAT Korea has been rushing to take necessary steps to make glo available as soon as possible.

IQOS and glo, both comprising of a tobacco holder and a recharger, do not produce harmful smoke because they heat, not burn, tobacco sticks to generate a vapor that contains nicotine, according to the companies.

BAT Korea said Tuesday it has completed the construction of its second and third plants in Sacheon, South Gyeongsang Province.

The new facilities will produce Neostiks, tobacco sticks for glo, for Korea, Japan and other Asian markets, serving an export hub for the London-headquartered multinational tobacco giant. The Sacheon plant currently exports about 43 percent of its output to 13 countries.

The company invested 200 billion won ($178 million) to build the second and third plants and added 200 new workers to its payroll.

Through the latest expansion, the factory is capable of producing 40 billion sticks annually and further establishes itself as BAT’s global manufacturing center for Asia, according to BAT Korea CEO Tony Hayward.

“The Sacheon factory is expected to not only take up the role of an export hub of Asia but also a global manufacturing hub of specially designed tobacco Neostiks, made exclusively for our tobacco heating product (THP), glo,” Hayward said. “BAT has high expectations for the expansion of the Sacheon plant, which is already assessed to be one of the best of the company’s manufacturing plants. BAT Korea is committed to launching glo in Korea and offering made-in-Korea products to local adult smokers.”

The company expects glo to become a game changer in the tobacco industry, saying the innovative product will be a huge hit once it becomes available for Korean consumers.

“Since being released in Sendai, Japan, last December, glo’s market share there has reached over 7 percent, indicating it has been well received by Japanese consumers,” a BAT Korea official said. “We believe the same thing will happen in Korea.”

Since early May when Philip Morris announced a plan to launch the IQOS here, BAT Korea has been scrambling to obtain state approval for glo, as well as taking other administrative and legal measures to put it on the market as quickly as possible.

“We do not know exactly when we can have glo available in Korea. But we are doing everything we can to speed up the process,” the official said.

He said glo will be priced at 80,000 won and packs of 20 Neostiks at about 4,300 won.

In comparison, Philip Morris sells the IQOS for 120,000 won and the HEETs, its tobacco sticks, at 4,300 won via CU convenience stores in Seoul.

Since the IQOS and HEETs were first introduced in Japan in September 2015, more than 2 million people now use them in more than 25 countries.

According to Philip Morris, IQOS produces about 90 percent less harmful chemicals and leaves no ash and fewer odors on smokers.

The device is made up of a charger about the size of a mobile phone and a holder that resembles a pen. A tobacco stick is inserted into the holder, which then heats it to temperatures up to 350 degrees Celsius. The tobacco vapor released contains nicotine, tobacco flavors and a number of other chemicals.