BAT Japan Strengthens Oral Tobacco 'VELO' Business with New Structure, Marking New President's Appointment and 25th Anniversary

(BAT Japan President, Mauricio Lara)

British American Tobacco Japan, G.K. (HQ: Minato-ku, Tokyo; President: Mauricio Lara; hereafter "BAT Japan") announced on March 26, 2026, that to mark the appointment of a new president and its 25th anniversary, it will accelerate efforts to expand smokeless products in the Japanese market and strengthen its oral tobacco "VELO" as a future key focus area. The company will promote a multi-category strategy that responds to the changing social environment and consumer needs, contributing to the development of the Japanese smokeless market.

The BAT Group has set a policy to derive the majority of its revenue from the smokeless business by 2035. BAT Japan is already a leading market where the smokeless business constitutes over 50%[1] of revenue, and it will drive the group's overall growth by capturing the growing domestic demand for smokeless products.

Growing Demand for Oral Tobacco Worldwide and in Japan

Oral tobacco is a smokeless product used by placing it between the gum and cheek. It is characterized by producing no smoke, odor, or ash, and thus does not cause unwanted secondhand smoke. As it requires no device or charging and can be used hands-free, it is easy to use regardless of place or time. Furthermore, because it does not involve combustion, exposure to harmful substances is considered to be at a very low level[2].

Globally, the oral tobacco market is rapidly expanding. It is the fastest-growing category in the tobacco market[3], with the number of users expected to grow at a compound annual average rate of 6-15% from 2025 to 2030[3]. In Sweden, the birthplace of oral tobacco, the usage rate is about three times that of cigarette smoking[4], and the mortality rate from smoking-related diseases is at the lowest level in the EU[5].

In Japan, the oral tobacco market is also steadily expanding; the number of users is estimated to have grown from about 300,000 in 2022 to about 900,000 in 2025[6]. By 2030, it is seen as having the potential to grow to a scale of 4 to 5 million people[6].

Changes in Japan's Smoking Environment and Consumer Needs Boost VELO's Growth

VELO is the world's No. 1 oral tobacco brand by global share[7]. As a brand originating from Sweden, it has expanded to about 50 markets, establishing a strong presence as the category share leader in Europe[7] and the fastest-growing brand in the United States[7]. In Japan, since its launch in 2020, its annual sales volume has nearly doubled almost every year[8]. It has a nationwide sales network, the largest number of flavors in the country, and offers mini-sized pouches tailored to Japanese consumers.

Currently in Japan, the number of smoking environments has been decreasing, prompted by the revision of the Health Promotion Act in 2020. Social and environmental changes are also advancing, such as increased friction between smokers and non-smokers in the workplace over tobacco breaks and odors.

Furthermore, driven by three consumer needs (3Cs) — "Convenience" (usable anytime, anywhere), "Consideration" (a use characteristic that is considerate to both oneself and others), and "Conversion" (ease of switching due to affordable pricing) — VELO is leading the growth of the oral tobacco category in Japan.

Taking the VELO Business to the Next Growth Stage with Over 1 Million Trial Opportunities and Enhanced Sales Channels/Flavor Expansion

Based on this market potential, in 2026, BAT Japan will provide smokers with V...