Three key trends force tobacco companies to continuously re-assess and optimize their manufacturing footprint:
(1) Cost savings: Transferring labor intensive operations to lower-cost countries within a certain geography
(2) Geographical re-balancing: Fast-declining cigarette volume in the Western markets vs. Stable (even, increasing) cigarette volume in the emerging markets (especially, in East & Southeast Asia)
(3) Product mix re-balancing: Transformation from cigarettes to RRP/NGPs. Japan Tobacco is currently producing heated tobacco sticks in Tokyo (Japan), Kansai (Japan) and Gosko (Poland) factories alongside combustible products.
The recent developments on Japan Tobacco’s manufacturing footprint:
September 2026: Japan Tobacco Expands Philippines Facility with Southeast Asia’s First Dry Ice Expanded Tobacco Plant
Japan Tobacco (JT) has significantly scaled up the technological capabilities of its manufacturing plant in Malvar, Batangas, investing over ₱2.1 billion ($33.6 million) to upgrade the site with advanced processing infrastructure. The investment centers on the construction of JT’s first Dry Ice Expanded Tobacco (DIET) plant in Southeast Asia. Accounting for roughly ₱1.9 billion of the capital allocation, the new system utilizes carbon dioxide to expand tobacco before it is conditioned and blended for cigarette production. With this addition, the Batangas site joins JTI’s existing network of DIET-equipped Asian facilities located in Bangladesh and Japan.
The multi-billion-peso upgrade also incorporates funding for the expansion of the facility’s Controlled Atmosphere (CA) treatment unit, which became operational to double raw-leaf treatment capacity and preserve material quality. The company noted that the Philippine manufacturing hub serves a dual purpose, producing goods for the domestic market while functioning as an export center that supplies 22 markets worldwide.
July 2026: Japan Tobacco is Aiming to Revive Ukraine as an Export Hub
Before the full-scale war, Japan Tobacco’s factory in Kremenchuk (Poltava region) supplied products to 22 markets, including Mexico, Saudi Arabia, Brazil, and Japan, with export revenue of $120 million. In 2023, exports dropped to 1.5 billion cigarettes. Japan Tobacco (JT) is aiming to restore its export capacity: in 2024, JT produced over three billion cigarettes in Ukraine for export, with a similar production plan for 2025. The number of export markets increased from 4 in 2023 to 8 in 2024 and 9 in 2025.
August 2025: Japan Tobacco will Relocate its Production in Romania to a New Factory
After more than three decades in Pipera (Bucharest), Japan Tobacco (JT) will relocate its production to a new factory in the town of Ștefăneștii de Jos, on the outskirts of Bucharest. Opened in 1994, the Pipera factory was the first production facility opened by an international tobacco manufacturer in Romania. Since then, JT has invested over €300 million euros in the local market. However, as the existing buildings no longer meet current technological and spatial requirements, JT decided to invest in a more efficient and modern factory, in an area with better logistical access at the intersection of major highways.
With a total investment of €70 million, Ștefăneștii facility marks one of the most ambitious expansions by an international tobacco manufacturer in Romania. The new plant is located on a plot of 18.3 hectares with a production area is almost 60,000 square meters – three times the existing facility in size. Equipped with machinery that can produce between 6,000 and 12,000 cigarettes per minute and ~3,000 filters per minute, Ștefăneștii plant has an installed production capacity of 36 billion cigarettes/year.
Currently, over 75% of the products manufactured by JTI in Romania are exported to over 70 countries. The product portfolio includes international brands such as Winston, Camel and Sobranie as well as tobacco sticks for Ploom heated tobacco device. JT has ~1,500 employees in Romania, operating in the headquarters, factory, technology center in Bucharest and in over 30 sales offices across the country. Moldova and Bulgaria markets are also managed from Romania. In 2023, JT Romania – through the JTI Trading and JTI Manufacturing entities – made €1.7 billion revenue.
June 2025: Japan Tobacco will Invest €30 Million in its Tenerife (Spain) Plant
Japan Tobacco (JT) will invest ~€30 million in its Tenerife plant, the largest cigarette production facility in Spain, over the next three years. The production capacity will already be increased by 20% in the 2024/25 fiscal year. Tenerife plant produced 3 billion cigarettes and 800 million cigarillos in the 2023/24 fiscal year. The investment is part of a broader strategy to enhance efficiency, quality and innovation, reinforcing Tenerife factory’s role as the European hub for cigarillo production and further boosting its export activity. Currently, 60% of the production volume is exported.
The investment will create 34 new jobs, adding to the existing workforce of over 260 employees. The CITA (Compañía Insular de Tabacos) Tenerife factory became part of JT subsequent to the Gallaher acquistion in 2007 and JT invested around €85 million in the plant over the last ten years. More than half of that amount was invested in the last four years, increasing the production capacity by 60%.
November 2024: Japan Tobacco will Invest US$40 million in the Turkish Factory Over the Next Three Years
Japan Tobacco International (JTI) invest US$40 million in its Turkish production facility located in Torbalı, Izmir over the next 3 years1. Inaugurated in 1992 and neighboring PMI’s mega factory, Torbalı is the third largest JTI manufacturing site in the world.
The US$40 million investment will mainly be used to construct a new tobacco processing (“primary”) building and complete the sustainability related enforcements (e.g. solar panel installations). It will also result in a limited increase in the plant’s annual manufacturing capacity from 53 to 54 billion sticks.
Turkey is one of the largest cigarette markets in the world with 136.5 billion sticks sold and 17% year-on-year growth recorded in 2023. PMI leads the market with ~50% share and JT is #2 with ~27% share. Moreover, Turkey is emerging as a regional export center. JT exports 28% of its production in Torbalı (~15 billion sticks) to 56 countries and claims to be largest exporter of tobacco & tobacco products in Turkey.
August 2024: Japan Tobacco will Build a New Tobacco Processing Plant in the Trier, Germany Factory
Japan Tobacco International (JTI) will invest €30 million to build a new tobacco processing facility in the Trier, Germany factory. The facility will process a special mix of tobacco leaves to be used to produce heated tobacco sticks in Lodz, Poland. Recall that JTI employs around 2,000 people in the Stary Gostkow, Lodz mega factory, where cigarettes, heated tobacco sticks and other tobacco products are manufactured mostly for the EU countries.
Trier is the only JTI factory in the world to have a special primary facility designated for heated tobacco sticks. The new facility is scheduled to go into operation in Q1 2026. JTI employs around 1,800 people in Trier facility.
Recall: JT will invest ¥450Bn ($2.9Bn) in heated tobacco products over the three-year period from 2024 to 2026 – increasing the number of markets where Ploom is sold to around 45 by 2026 (i.e. more than three times the number at the end of 2023).
July 2024: Japan Tobacco will Build a New Factory in Morocco
Japan Tobacco International (JTI) will invest ~$92 million to build a new factory in Morocco, creating 170 direct jobs. The facility will be located in Tetouan Park in the Tanger Med industrial zone.
The Tetouan Park factory will be built on a 4.7-hectare site with an 18,000-square-meter built area and the construction is set to start in August 2024. To achieve Green Factory status, the plant will feature energy-efficient technologies (e.g. LED lighting and automated climate control systems) as well as a rainwater collection & recycling system.
With this new investment, JTI aims to strengthen its presence in the North and West Africa Region. The initial annual production capacity of the plant is planned to meet the needs of the Moroccan market – around a third of which is held by JTI, mainly through its flagship brands, Camel and Winston. Considering that Casablanca, Morocco serves as the regional hub for the 12 North & West African markets, the production capacity is likely to be increased at a later stage to supply the export markets.
