Boston, MA 12/25/2013 (wallstreetpr) – Altria Group Inc (NYSE:MO) is the manufacturer of the popular Marlboro cigarette brand, that is sold in the U.S. and worldwide. The company owns Philip Morris USA, the biggest cigarette maker in the U.S. In 2008, it spun off Philip Morris International to reduce its risk exposure and increase opportunities overseas.
But, even with these operation tweaks, Altria Group Inc (NYSE:MO) continues to suffer decline in the sale of its mainstream products – tobacco cigarettes. With increasing health concerns, smoking bans, tax increases and stigma, tobacco companies have been running out of favor with the market and profits are shrinking scarily fast. In this condition, alternatives have been sought to keep big tobacco in business and one of the viable options seems to be venturing into electronic cigarette manufacturing.
Electronic cigarettes or e-cigarettes is fairly a new concept in the smoking market, but their popularity has been growing like a bush fire. A few years ago, there were just a few thousand people using the devices but today there are millions of users, and the uptake rate is impressive.
E-cigarettes
Electronic cigarettes were initially scoffed at by big tobacco, but the reality is quickly sinking that they could be the savior of the troubled industry. E-cigarettes deliver doses of nicotine by heating nicotine vapor electronically using an inbuilt battery. This process ensures that toxic components of tobacco are bypassed. In this sense, e-cigarettes are considered safer alternatives to the traditional cigarettes.
Venturing into e-cigarette
Altria Group Inc (NYSE:MO) and Philip Morris International, have announced the details of an agreement last week in which the two companies will share electronic cigarette technologies, while also developing next-gen products to sustain their profitability.
Commenting on the announcement, which was made last Friday, Altria Group CEO Marty Barrington said that the move is in line with his company’s ongoing efforts to create a robust portfolio of alternative products for the adult tobacco consumers.
Altria Group Inc (NYSE:MO) launched its first e-cigarette in August through its subsidiary NuMark, and the product, MarkTen, is presently being tested in Indiana.
