BAT Investing 800 Million Euros in its Romanian Factory

Last Monday on the 11th of June, tobacco giant British American Tobacco (BAT), announced that it will be investing 800 million euros to bump up the production of its Glo Neostiks in its factory in Ploiești, Romania.

Diane Caruana

June 15, 2018

This investment, which will be spread over the the next five years, is expected to generate approximately 200 new jobs, and will go towards building a new manufacturing hall for BAT’s Neosticks. This will result in the creation of an additional 7,000 sq m of production space which will turn this factory into the sole supplier of glo Neostiks across Europe.

This investment will result in the creation of an additional 7,000 sq m of production space which will turn this factory into the sole supplier of glo Neostiks across Europe.

“We have a long-held ambition to offer smokers a range of potentially reduced-risk products – like tobacco heating devices, e-cigarettes and oral tobacco,” said BAT’s regional director for Europe and North Africa, Tadeu Marroco. “This ambition has seen us launch vaping products and tobacco heating devices in 16 countries in the last five years and we’ve bold plans to increase our geographical footprint in the second half of 2018.

“The significant investment in our factory in Romania is testament to our commitment to offer smokers a wider range of tobacco and nicotine products – with a particular focus on potentially reduced-risk alternatives to smoking – in an increasing amount of countries,” he added.

Focusing on revenue from cigarette alternatives

Last September, BAT announced major changes in its management structure, in order to incorporate vaping products in its core business. “Now that we have built a successful NGP (next generation products) business which is poised for substantial growth, we will be fully integrating NGP to leverage the scale and expertise of the whole group to drive growth in an area that is fast becoming a key part of our mainstream business,” said the tobacco company at the time.

The following month, the owner of Lucky Strike, Pall Mall and Camel had acknowledged that as people are becoming more conscious about the dangers of smoking, its traditional business is under pressure. Therefore its new business strategy includes increasing revenue from its safer alternatives by £5 billion, to an astounding $6.6 billion, by 2022.

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