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[Asia Economy Reporter Lee Seon-ae] Domestic liquid-type (CSV, closed system vaporizer) e-cigarettes are effectively being phased out. Sales have plummeted following the government's recommendation to stop using liquid-type e-cigarettes, leading to consumer rejection.

◆The Apple of the e-cigarette world finally withdraws from Korea= On the 7th, Juul Labs Korea announced its withdrawal from the domestic market, about one year after entering the Korean market in May last year. Juul Labs Korea explained the reason for the withdrawal, stating, "We initiated restructuring earlier this year to secure business sustainability, but ultimately concluded that we must cease operations in Korea."

This comes seven months after the Ministry of Health and Welfare issued a strong recommendation to stop using liquid-type e-cigarettes in October last year. At that time, the Ministry made this decision due to ongoing cases of severe lung injuries caused by liquid-type e-cigarettes in the United States. Subsequently, convenience stores, which account for most of the domestic tobacco distribution, stopped selling Juul products. Two months later, a Food and Drug Safety Ministry investigation revealed that vitamin E acetate, which can cause severe lung disease, was detected in some products including Juul, worsening the situation. As a result, Juul Labs Korea downsized its headquarters staff from about 100 to 7 by restructuring all 38 sales employees at the beginning of the year to reduce costs. They also closed three flagship stores located in Seoul’s Garosu-gil, Gwanghwamun, and Yeonnam-dong, raised product prices by 10,000 KRW, and took other profitability improvement measures to "hold on" until regulations eased, but ultimately could not withstand the business slump and gave up on the domestic market.

Some products of KT&G’s liquid-type e-cigarette "Seed" (Toba, Tundra), which are also subject to the government’s usage suspension recommendation, are disappearing from the market. A KT&G official said, "Although demand for liquid-type products has sharply declined, some products are still being sold," adding, "We will monitor the market situation after the Food and Drug Safety Ministry’s announcement and make judgments accordingly."

A GS25 store in Seoul removing Juul products from the shelves. Photo by Hyunmin Kim kimhyun81@

◆Liquid-type e-cigarettes disappearing= Sales of liquid-type (CSV standard) e-cigarettes in the domestic market continue to decline. According to the Ministry of Economy and Finance, sales of CSV e-cigarettes in the first quarter of this year were 900,000 pods (liquid container units, one pod is counted as one pack), marking the lowest quarterly figure since their launch in May last year. After Juul entered the Korean market, CSV e-cigarettes gained tremendous popularity, with quarterly sales reaching 6.1 million pods in Q2 and 9.8 million pods in Q3 last year, but sales sharply dropped to 1 million pods in Q4 following government recommendations to reduce or stop usage. A Ministry of Economy and Finance official explained, "The Ministry of Health and Welfare, together with related ministries, issued three rounds of recommendations to reduce or stop usage and implemented related measures, which have continuously impacted the market." Furthermore, the Food and Drug Safety Ministry is expected to announce the "Research Results on the Human Harmfulness of Liquid-type E-cigarettes" as early as next month, which is likely to further narrow their market presence.

Tobacco companies are also reluctant to launch liquid-type e-cigarettes. Global companies such as Philip Morris and BAT sell liquid-type e-cigarettes in overseas markets like Europe but focus solely on heated tobacco products in the domestic market. This is because consumer perception of liquid-type e-cigarettes is poor due to safety concerns, so there is no need to push aggressively. Accordingly, Philip Morris’s next-generation e-cigarette new products "IQOS MESH" and "VEEV" will launch in 10 countries this year, but Korea is reportedly excluded from the list of launch countries.

◆Tensions rise ahead of Food and Drug Safety Ministry’s June harmfulness announcement= Industry tensions are peaking ahead of the Food and Drug Safety Ministry’s scheduled June announcement of the analysis results on suspected harmful substances in liquid-type e-cigarettes. Currently, the Korea Electronic Cigarette Association has requested disclosure of the Ministry’s research methods, and after the Ministry refused, filed a lawsuit at the Seoul Administrative Court on the 1st. The Association stated, "The Ministry of Food and Drug Safety is conducting the 'Research on the Human Harmfulness of Liquid-type E-cigarettes' scheduled for announcement in June but refuses to disclose accurate experimental results and conditions, engaging in secretive administration," adding, "Having already lost its qualification as a nationally certified verification agency, the Association has filed a lawsuit requesting the court to cancel the Ministry’s refusal to disclose information in accordance with the Constitution and laws." The Association further urged, "We expect the judiciary, the last bastion protecting citizens’ rights, to make a wise judgment, and the Ministry should transparently disclose all information now to restore at least the minimum qualifications as a national institution."

This content was produced with the assistance of AI translation services.