[Intl-tobacco] Thailand: Sales may plunge 15% once warnings kick in

[robert weissman]

Bangkok Post
Sales may plunge 15% once warnings kick in

Saturday, March 12, 2005

WICHIT CHANTANUSORNSIRI


Warning signs posted alongside tobacco product displays are having an
impact. - WEERA WEERAPHAN
The Thailand Tobacco Monopoly estimates that new anti-smoking measures
to be introduced by the government will result in sales falling by
around 15%, according to managing director Suchon Watanapongvanich.

Starting on March 25, all cigarette packs sold in Thailand must carry an
enlarged warning label equal to half the length of the pack, featuring
graphic pictures aimed at alerting smokers of the potential dangers of
heart and lung disease, cancer and other conditions.

The Public Health Ministry also has proposed increasing excise taxes on
cigarettes to 80% from 75%, a move that would increase the retail price
of cigarettes by at least nine baht per pack. Overall, more than 10 new
measures are planned under the anti-smoking campaign.

Mr Suchon said the new anti-smoking stance would have a profound impact
on sales and business trends for the TTM and the entire industry.

The state-owned TTM last year produced over 34.6 billion cigarettes,
with sales of more than 49.5 billion baht, representing around 75% of
the entire Thai cigarette market.

Foreign tobacco brand sales in Thailand last year accounted for 10
billion cigarettes. Smuggled cigarettes and copycat knockoffs are
estimated to represent another 5% of total market sales.

Mr Suchon said the TTM had invested 110 million baht in new technology
and printing machinery to comply with the label warning regulation.

He said TTM's 500,000 retailers nationwide had also been notified to
adjust their stock levels to clear existing inventories in preparation
for the introduction of the new cigarette pack designs.