The iQOS device, is a smokeless alternative to combustible cigarettes and works by heating tobacco leaves known as Heets. These refills which look like short cigarettes, must be inserted into the device and are heated it up once iQOS is turned on. Last year, Bloomberg reported that these heat sticks will be sold under the Marlboro brand for approximately the same price as their combustible counterparts.
PMI has invested billions in producing alternatives to tobacco cigarettes and are hoping that revenue will reach 1.2 billion by 2020, whilst aiming to produce 32 million iQOS devices for distribution just during this year. The device will be available in Seoul from June 5 onwards and in the second half, sales will extend to other cities and regions of the country.
PMI investing big in safer alternatives
An article published earlier today on local Yonhap news site said that in South Korea the average retail price of the new device is set at 120,000 won (US$107), while a packet of 20 Heets will be sold for 4,300 won. Packets of combustible cigarettes cost an average of 4,500 won throughout the country.
Lower taxes for safer alternatives
Since unlike the US, South Korea categorizes e-cigarettes differently than their combustible counterparts, iQOS will be levied at a lower tax rate than the 75% imposed on regular cigarettes. South Korea has been actively fighting smoking. Earlier this year the Ministry of Health and Welfare of South Korea, successfully implemented a regulation that forces cigarette manufacturers to put graphic images of the harmful effects of smoking on cigarette packets.