Amid New Zealand’s strategy to achieve a smoke-free nation by 2025, the smoking rate in the country has continued to decline. Public health campaigns, higher tobacco taxes, and smoking bans in public places have contributed to this. Smoking has a more negative image, especially among younger generations, who are increasingly health conscious. This trend has prompted many tobacco companies to pivot towards alternative products, such as heated tobacco and e-cigarettes, to capture a share of non-combustible nicotine sales.
Volume sales of tobacco declined again in 2024, but rose slightly in current value terms.
The competitive dynamics within tobacco in New Zealand remained relatively stable in 2024. With the traditional tobacco categories of cigarettes and cigars, cigarillos and smoking tobacco experiencing little innovation due to the tight marketing and advertising laws that regulate these categories, e-vapour products and heated tobacco were among the more dynamic subcategories, with e-vapour heavily segmented. Nonetheless, the major multinational players continue to dominate the tobacco industry overall. British American Tobacco (New Zealand) Ltd, Imperial Tobacco New Zealand Ltd, and Philip Morris (New Zealand) Ltd sustained their significant shares, particularly in the cigarette segment. British American Tobacco held the top spot in retail volume sales, a position it has maintained for years, with Imperial Tobacco and Philip Morris following. Demand for cigars and cigarillos saw Philip Morris lead ahead of Scandinavian Tobacco Group A/S, as the former appealed to price-conscious consumers, whereas STG focuses on premium options. In fine cut tobacco, British American Tobacco remained the clear leader, with Imperial Tobacco as a key competitor. Overall, the competitive dynamics remained unchanged, with these established players maintaining control over both the volume and various product categories within tobacco.
In 2024, the leading distribution channel for tobacco in New Zealand was supermarkets, followed by convenience stores. These retailers play a significant role in tobacco sales, making cigarettes easily accessible to a wide range of consumers. Forecourt retailers, often with 24-hour availability, also serve as key points of distribution. In addition, licensed premises provide a steady stream of tobacco products. These outlets are supported by a network of wholesalers who supply a variety of retailers, ensuring widespread availability across urban and rural areas. This well-established distribution system ensures that cigarettes remain accessible to local consumers, despite ongoing regulatory changes and the industry's efforts to transition toward reduced-risk alternatives.
Overall sales of tobacco are set to rise over the forecast period in volume and current value terms. Cigarettes and cigars, cigarillos and smoking tobacco are all expected to continue their volume decline as more smokers transition to e-vapour products, which are perceived as healthier alternatives and will be the main driver of growth over the forecast period.
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Tobacco
Passport Tobacco covers the seven major tobacco categories: Cigarettes, Cigars & Cigarillos, Smoking tobacco (made up of Pipe tobacco and RYO tobacco), Smokeless Tobacco (snuff and chewing tobacco), E-Vapour Products (closed and open); Heated Tobacco; and Tobacco Free Oral Nicotine. Smoking paraphernalia such as pipes, rolling papers, lighters or matches, etc., are not included, nor are nicotine replacement therapy (NRT) products, which are part of Euromonitor's Passport Consumer Healthcare database.
See all of our definitionsThis report originates from Passport, our Tobacco research and analysis database.
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