Japan Tobacco Inc. has drafted a backup system to ensure global cigarette supplies if production is hit by a natural disaster, JT President and Chief Executive Officer Mitsuomi Koizumi said.
“We have formed a global project team and finished studying all measures . . . We are steadily proceeding with a plan,” Koizumi said in a recent interview.
JT was forced to suspend tobacco shipments after the March 2011 earthquake and tsunami, but Koizumi said the plan will cover more than just domestic production.
“With regard to natural disasters, we don’t know what is going to happen in any country,” he said, referring to the massive flooding in Thailand last year.
The plan designates which of its six domestic and 22 overseas tobacco plants will serve as backups if a particular plant is damaged by a natural disaster, and shows how it will diversify its materials procurement, Koizumi said.
To expand overseas sales amid shrinking domestic demand, the world’s third-largest maker of tobacco products by volume said earlier this month it will change the name of Mild Seven, its main cigarette brand, to Mevius.
The change will help boost sales in some parts of Europe where the adjective “mild” is deemed as misrepresenting the health risks of smoking.
To strengthen its lineup of lower-priced products amid the global economic slump, the company has acquired Belgian tobacco maker Gryson NV, known for its cut tobacco by people who roll their own cigarettes.
“It is very important to enhance our brand portfolio for marketing” to sell products regardless of economic conditions, Koizumi said, adding that a premium brand has “room for growth” in places like emerging markets in the long term, given their economic expansion.