HnB devices, including PMI’s iQOS and KT&G’s lil, have soared to 11.8% of the total e-cig market in South Korean in the past two years.
HnB device is a battery-driven alternative to flammable cigarettes. Its working principle is to heat cigarette sticks containing tobacco leaves. These cigarette cartridges look like short cigarettes, which need to be inserted into the heater with the device on to heat the tobacco.
This product was launched in Korea only two years ago, but according to data released by the Ministry of Economy and Finance in December last year, cigarettes sold 288 million packs in November, of which 35 million packs were substituting products of HnB. This is equivalent to 11.3%, higher than 7.3% of the previous year.
HnB’s total tax revenue has reached 10.7 trillion won
Last December’s report added that Haiti’s National Health and Budget Bureau had accumulated sales of 295.5 million packs of substituting HNB cartridges, accounting for 9.3% of the tobacco market. Meanwhile, the total production and sales tax of all tobacco products in Korea is 10.7 trillion won ($9.5 billion), an increase of 2.6% over the same period in last year. Compared with the same period in 2014, the sales tax increase 63.9% sharply.
Further data released by the government show that HNB sales reached 92 million packs in the first quarter of this year in Korea, an increase of 34% over the same period last year. This is equivalent to an increase of 11.8% at the end of March, 2.2% higher than two years ago.