Philip Morris International (hereafter referred to as PMI) will invest $600 million to build a factory in Aurora, Colorado, USA, to meet strong demand from American consumers for its Zyn nicotine pouches. The factory is expected to commence operations by the end of next year and begin full production in 2026.
Stacey Kennedy, President and CEO of PMI Americas, stated in a release, “PMI and its U.S. affiliates are accelerating our mission by investing in a new U.S. manufacturing facility to help American adult smokers move away from cigarettes, meeting the growing demand for scientifically substantiated, better alternatives to nicotine.”
“We believe Colorado shares our values in innovation, economic opportunity, and public health, and we look forward to partnering with the state and its skilled workforce as we expand our manufacturing footprint in the U.S.”
During the first quarter, Zyn experienced an 80% surge in sales, causing PMI difficulties in meeting market demand. Retailers have faced shortages of Zyn products, sometimes limiting the number of cans customers can purchase each month.
In response to a subpoena from the District of Columbia requesting information on flavored nicotine pouches prohibited from sale locally, PMI decided to halt online sales nationwide starting June, further constraining supply.
PMI is also increasing production of Zyn nicotine pouches at its Owensboro facility in Kentucky. The company noted that these investments not only aim to meet U.S. demand but also support export capabilities.
Data indicates that in 2023, Zyn captured over 70% of the $8.6 billion nicotine pouch market. Analysts suggest that ongoing supply shortages, in a category with relatively young demographics and low brand loyalty, could prompt some consumers to switch to other brands, presenting opportunities for competitors.
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