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Tobacco Company Credits Falling Gas Prices With Rising Sales

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Gas prices have fallen signifiantly in the last year or so, which is great news for consumers, if not necessarily for gas stations. There’s another hidden winner in this situation: tobacco companies. Customers who are spending less on gas have more money to spend on cigarettes, and gas stations happen to be a convenient place to buy them.

Of course, no one’s going to say, “Hey, it only cost $40 to fill up my tank: time to take up smoking!” Yet having more spending money might lead people who already smoke to buy at a gas station instead of buying in bulk elsewhere. That analysis comes from an actual tobacco company: Reynolds American Inc. released its earnings report, and it showed the first increase in sales since 2004 for that company. (Reynolds makes Camel and Natural American Spirit brands of cigarettes, and Grizzly and Kodiak snuff brands.)


Company representatives don’t actually expect that increase to last, but they do credit falling gas prices with the slight boost in sales.


Think how much tobacco companies could boost their profits if they actually used the free mascot that satirical news program “Last Week Tonight” designed for them!


Smokers Spend Gasoline Savings on Tobacco, Fueling Surprise Gain [Bloomberg]




by Laura Northrup via Consumerist

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