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Tobacco Product Manufacturing in the UK - Market Size, Industry Analysis, Trends and Forecasts (2025-2029)

Gaetana Mak Gaetana Mak London, United Kingdom Last Updated: July 2025 SIC UK-C12

Revenue

£78.3bn

2025-26

£80.2bn

Past 5-Year Growth

Profit

£XX.Xbn

Employees

88,447

Businesses

868

Wages

£X.Xbn

Tobacco Product Manufacturing in the UK industry analysis

Europe’s tobacco product manufacturing industry is undergoing a significant transformation as traditional cigarette consumption declines. For decades, this industry was driven by a steady demand for cigarettes, but changing consumer habits and stringent government regulations are pushing tobacco companies to rethink their strategies. Launched in February 2021, Europe's Beating Cancer Plan prioritises tobacco control as a key strategy to reduce cancer incidence and mortality. The plan aims to achieve a tobacco-free generation by reducing tobacco use to below 5% of the population by 2040 and has called for stricter tobacco control policies, including measures to restrict access to tobacco products, particularly for young people including smoke-free environments to include e-cigarettes and heated tobacco products and extend smoke-free areas to outdoor spaces. 

Trends and Insights

  • Tobacco giants pivot to perceived healthier alternatives. Aware of changing preferences and health concerns, these companies are now heavily investing in vaping and heated tobacco products, moving beyond traditional cigarettes to stay relevant.
  • Cigarette demand in Europe is falling. This dip is largely because folks are waking up to the health risks, facing tougher laws, and finding other ways, like vaping, to satisfy their nicotine fix.
  • Big tobacco dominates the market. Thanks to deep pockets that fuel aggressive advertising, extensive distribution networks, and continuous innovation. Their stronghold allows them to set trends and preferences, securing a massive competitive edge.
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Top Questions Answered in this Report

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What is the market size of the Tobacco Product Manufacturing industry in the United Kingdom in 2025?

The market size of the Tobacco Product Manufacturing industry in the United Kingdom is £78.3bn in 2025.

How many businesses are there in the Tobacco Product Manufacturing industry in the United Kingdom in 2025?

There are 868 businesses in the Tobacco Product Manufacturing industry in the United Kingdom, which has grown at a CAGR of 7.0 % between 2020 and 2025.

Has the Tobacco Product Manufacturing industry in the United Kingdom grown or declined over the past 5 years?

The market size of the Tobacco Product Manufacturing industry in the United Kingdom has been growing at a CAGR of 1.3 % between 2020 and 2025.

What is the forecast growth of the Tobacco Product Manufacturing industry in the United Kingdom over the next 5 years?

Over the next five years, the Tobacco Product Manufacturing industry in the United Kingdom is expected to grow.

How competitive is the Tobacco Product Manufacturing industry in the United Kingdom?

The level of competition is moderate and increasing in the Tobacco Product Manufacturing industry in the United Kingdom.

Everything you need in one report

  • Reliable market estimates from 2015-2030
  • Competitive analysis, industry segmentation, financial benchmarks
  • Powerful SWOT, Porter’s Five Forces and risk management frameworks
  • Online membership platform with PDF, Word, Excel and PPT exports

Table of Contents

External Environment

Highlights

Trends
  • Regulation & Policy
  • Assistance

Key Takeaways

The EU is strict on tobacco regulation for public health. The EU and other European governments have implemented rigorous regulatory measures focused on tobacco. These policies aim to curb tobacco use, prioritise public health and reduce the burden of tobacco-related diseases.

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External Drivers

Analysis

What demographic and macroeconomic factors impact the Tobacco Product Manufacturing in the UK industry?

Financial Benchmarks

Highlights

Trends
  • Profit Margin
  • Average Wage
  • Largest Cost

Key Takeaways

Tobacco production costs are climbing. Despite stable leaf prices, factors like climate change and stricter farming regulations, coupled with higher freight and paper costs, are making it more expensive for Europe's tobacco manufacturers to produce their products.

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Cost Structure

Charts
  • Share of Economy vs. Investment Matrix
  • Industry Cost Structure Benchmarks:
    • Marketing
    • Depreciation
    • Profit
    • Purchases
    • Wages
    • Rent
    • Utilities
    • Other
Analysis

What trends impact cost in the Tobacco Product Manufacturing in the UK industry?


Key Ratios

Data tables
  • IVA/Revenue (2015-2030)
  • Imports/Demand (2015-2030)
  • Exports/Revenue (2015-2030)
  • Revenue per Employee (2015-2030)
  • Wages/Revenue (2015-2030)
  • Employees per Establishment (2015-2030)
  • Average Wage (2015-2030)

Country Benchmarks

European Leaders & Laggards

Data Tables

Top and bottom five countries listed for each:

  • Revenue Growth (2025)
  • Business Growth (2025)
  • Job Growth (2025)

European Country Performance

Data Tables

Rankings available for 37 countries. Statistics ranked include:

  • IVA/Revenue (2025)
  • Imports/Demand (2025)
  • Exports/Revenue (2025)
  • Revenue per Employee (2025)
  • Wages/Revenue (2025)
  • Employees per Establishment (2025)
  • Average Wage (2025)

Structural Comparison

Data Tables

Trends in 37 countries benchmarked against trends in Europe

  • Concentration
  • Competition
  • Barriers to Entry
  • Buyer Power
  • Supplier Power
  • Volatility
  • Capital Intensity
  • Innovation
  • Life Cycle

Key Statistics

Industry Data

Data Tables

Including values and annual change:

  • Revenue (2015-2030)
  • IVA (2015-2030)
  • Establishments (2015-2030)
  • Enterprises (2015-2030)
  • Employment (2015-2030)
  • Exports (2015-2030)
  • Imports (2015-2030)
  • Wages (2015-2030)

Methodology

Where does IBISWorld source its data?

IBISWorld is a world-leading provider of business information, with reports on 5,000+ industries in Australia, New Zealand, North America, Europe and China. Our expert industry analysts start with official, verified and publicly available sources of data to build an accurate picture of each industry.

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