Vaping: A Billion Pound Industry

E-Cigarette Vaping

Global sales of e-cigarettes, or vaping devices, have grown this year by 59 per cent, reaching £3.9billion – or for the first time, more than $6billion.

Turnover generated by e-cigarette kits and accessories such as Phoenix e-cig batteries, customisable atomisers and starter sets climbed 75 per cent in the UK to £469million, while in the US – the largest market for e-cigarettes globally – it doubled, reaching £1.7billion in total revenue.

A 2014 report published by Public Health England predicted that the UK vaping industry would be worth some £340million. In reality it’s worth almost £130million more than that.

The rise of vaping contrasts sharply and perhaps predictably with the drop off in UK sales of stop-smoking aids like nicotine replacements, including nicotine patches and gum.

Nicotine replacement therapy (otherwise known as NRT) underwent its first drop in sales since 2008, falling three per cent to £137million and bringing to an end four years of unbroken growth. Sales of vaping equipment in the UK first rose above those of NRT in 2012. Now it has grown to become three times bigger.

Shane MacGuill is a senior tobacco analyst at business research firm Euromonitor. He told the Daily Telegraph that in larger markets such as the UK, now the world’s second-largest for vaping, the trend “does look a lot like correlation and perhaps even causation”.

“Up until now there has been no direct competition for cigarettes in a meaningful sense, and nicotine replacement therapies were certainly not providing that,” MacGuill said. “The days of the traditional cigarette are numbered – the only question is how long that process will take – and e-cigarettes have the potential to drastically shorten the shelf life of traditional tobacco products.”

Vaping, MacGuill said, is “a difficult proposition for the tobacco industry and something it should be very worried about”.

Not that the tobacco industry is running scared just yet. It is roughly 30 times larger than the burgeoning e-cigarette market, accounting for some £15.5billion in sales. And cigarette sales grew in the UK during 2014, albeit by less than one per cent, proving the industry is in rude health. Globally the growth was closer to six per cent, with China, a country where tobacco smoking is deeply ingrained, accounting for much of that rise in sales.

However, ASH, the UK’s anti-smoking lobby group, considers vaping a viable way to help smokers quit their habit. It says in a report from November 2014 that: “There is little real world evidence of harm from e-cigarettes to date, especially in comparison to smoking. Smoking tobacco is a major risk to health and half of all long-term users will be killed by their addiction. Every year 100,000 smokers will die from smoking-related diseases. This is because users inhale hundreds of toxic chemicals contained in the smoke.

“By contrast, electronic cigarettes are designed only to deliver nicotine. Although currently there is a lack of any firm evidence to establish their absolute safety, such products should be considered many times safer than smoking.”