Japan Tobacco Muscles Into American Market With LD Brand

The company is bringing inexpensive cigarettes to the United States.
July 20, 2016

GREENSBORO, N.C. – A tobacco invasion is quietly underway in the United States, with Japan Tobacco now selling cheap cigarettes, The Wall Street Journal reports. Japan Tobacco’s LD cigarettes are trying to undercut U.S. brands like Camel, Marlboro and Newport with its inexpensive pricing.

In March, LD became the first worldwide brand from Japan Tobacco to debut in the United States. Currently, nearly all of the company’s approximately $22 billion in sales are from countries outside of America. Japan Tobacco has been testing LD cigarettes in the Carolinas before rolling out a nationwide launch possibly next year. A spokesman told the Journal that Japan Tobacco “will continue to make appropriate investments for a company of our size, [with] 0.34% share of the cigarette market” in this country.

This investment could mean that other international tobacco firms will come back to the United States after years of staying away because of litigation concerns. Now that legal risks are declining and tobacco prices are rising, the United States is becoming more attractive to international tobacco companies.

The company wants to shoehorn its LD brand into the low-price cigarette shelf, which has long been the purview of Reynold’s Pall Mall and Altria’s L&M, whose contracts with major retailers have made it harder for competitors to garner shelf space. Japan Tobacco instead has zeroed in on independent retailers, such as Monroe Convenience in Charlotte, N.C.

Already, Japan Tobacco has upped its U.S. staff by a fifth; it also acquired U.S. e-cig firm Logic Technology Development in 2015.