It is also a time of transition for the tobacco giants. A 360-degree strategic turning point that points to an increasingly smoke-free world through products without combustion, such as those with heated tobacco and electronic cigarettes. Practically speaking, for those who cannot help but hold the cigarette between their lips, from “smoking” to “vaping”, from English to vape, that is, to produce steam.
Goal: in 2025 more than 50% of global profits will have to be smoke free. “We are facing an epochal change – underlines Marco Hannappel, president and CEO in Italy of the Swiss multinational Philip Morris since 2019, in Milan to present Veev, the latest addition to the company’s non-combustion product portfolio – certainly even bigger than what other realities have had. It is very interesting to experience such a moment within a company that can be defined as a pioneer of this change ».
Hannappel is a manager who comes from experiences of responsibility in hi-tech groups, such as Philips and Samsung, a professional with the credentials to manage the historic passage of Philip Morris. “It is significant – he says – that the group has focused not on a tobacco expert, but on a person used to working on technologies”. And Veev, a new idea of electronic cigarette, the result of over six years of research and development, is equipped with digital and intelligent control of the Mesh heater that allows you to detect when the liquid levels are low, automatically turning off the device.
Can we say that Italy is at the center of Philip Morris’ industrial strategies? Between strong investments and hires, a thousand in the last year alone. There are the plants of Zola Predosa and Crespellano, in the Bolognese area, then the assistance center of Taranto. With an integrated supply chain involving 30,000 workers and 8,000 suppliers, of which 1,000 are small and medium-sized tobacco companies. All this generates a billion of GDP a year.
«At the end of October we will inaugurate, again in Crespellano, the Service Center for innovation and research and development. We will have 260 highly specialized people, some of them already present. Furthermore, compared to the 2.4 billion dollars announced by the top management for the next generation industrialization activities, an important part will be invested in Italy ».
Will traditional cigarettes also be produced in Italy?
“Zero cigarettes, only 100% new technologies”.
And the Venetian, Umbrian and Campania tobacco producers?
«They also remain important in this new course. We are the only ones with five-year tobacco agreements and we invest in how to optimize water, whose consumption has been reduced by 53%, and energy. Philip Morris invests concretely on sustainability ».
Does transition also mean conversion?
«The production aspect follows that of the investment. Reconverting means, first of all, putting resources in the right place. And we did it and clearly. 99% of the resources in research and development go to new generation products and ultra-modern factories, such as the one in Crespellano ».
Stop to traditional cigarettes to make way for smokeless products towards a smoke free world. How will you convey this message?
«We count on an efficient commercial structure, including tobacconists and physical stores, which allows us to illustrate the product to adult smokers. And then there is our Taranto Center which works with digital ».
Your message to the youngest?
«You must not smoke or use products with nicotine. And we mustn’t start doing it ».
You are a leader, but China is always a pitfall.
«The solution is to keep innovating and be faster in change. Five years after the launch of Iqos, the system that heats tobacco without burning it, in 2022 we will be ready for a new paradigm. Iluma has already been launched in Japan: a new product platform that will improve opportunities for consumers ».
Philip Morris has also declared war on cigarette butts.
«It is also a transition for education thanks to a greater civic awareness. And we are committed to getting this message across ”.