Tobacco: Symptoms of Slump

Latest symptoms of the effect the Surgeon General’s report is having on the health of the tobacco industry: > Top tobacco distributors across the nation estimate that they sold 8% to 10% less last month than in January 1963—a possible retail sales loss of about $45 million. Cigarette tax receipts fell 2% in Arizona, 6% in Louisiana, 12% in Alabama, 14% in Illinois. Connecticut reported a 12% decline in sales, which cost the state $246,000 in expected taxes. — In Louisville, Brown & Williamson (Viceroy) and P. Lorillard (Kent) went on four-day weeks, and Philip Morris trimmed to a three-day week. R. J. Reynolds (Camel, Winston, Salem) has been on a four-day week for a month. Though cigarette sales usually slump just after Christmas, Reynolds admitted that the current drop in cigarette demand is “more than normal.”

In spite of all this, the U.S. Treasury expects sales to rebound after several months. The Commerce Department also figures that the number of smokers who quit or cut down will be offset by the youngsters who take up the habit.