Davidoff, Scandinavian Tobacco Group Not Exhibiting at InterTabac 2022

Two of the largest European cigar companies will not be exhibiting at the most prominent international cigar trade show later this year.

Oettinger Davidoff AG and Scandinavian Tobacco Group (STG) have separately confirmed to halfwheel that neither company will exhibit at InterTabac 2022, which takes place Sept. 15-17 in Dortmund, Germany. They are two of the largest and most prominent names in the cigar business, pulling out of the trade show at a time when many believe the non-Cuban large cigar segment in Europe is likely to significantly expand due to supply and pricing issues with Cuban cigars.

InterTabac is the largest international tobacco trade show containing a mixture of traditional tobacco products—cigarettes, cigars, pipes and smokeless tobacco—e-cigarettes and vaping products, and other accessories. There is also InterSupply, a section of the trade show that is focused on manufacturing solutions for the tobacco industry. In 2019, the trade fair was attended by nearly 14,000 people, dwarfing the other cigar trade shows. While some German retailers attended the trade show—called trade fair in Europe—InterTabac differs from American trade shows in that most exhibitors are there are to simply take meetings with existing clients rather than sell products.

The STG stand (right) has been a consistent presence at InterTabac for more than a decade.

STG is the parent company of General Cigar Co., Cigars International, Agio and others. Traditionally, it has had one of the largest stands—the word used to refer to trade show “booths” in Europe—at InterTabac.

Régis Broersma, senior vice-president of North American Brand and Rest of the World, provided a statement to halfwheel:

In a post COVID environment, STG like many other companies, has evaluated our trade show strategy and concluded that the high cost of participation does not outweigh the benefit to our business. Instead of participating in Dortmund, we will focus on leveraging our German sales force to deepen customer engagement via personal interaction at the retail level. And we will proceed similarly with our international customers by engaging in local one-to-one dialogue to support and grow our brands.

While STG is known primarily for its premium cigars in the U.S., the company’s machine-made division is extremely popular in Europe. In addition, the lack of STG is actually a reduction in two notable booths at InterTabac. Shortly before InterTabac 2019, STG announced an agreement to acquire Agio. Agio—which at the time was the German distributor for Drew Estate and La Flor Dominicana—also had its own stand, which was located in one of two main halls.

Unlike the American trade shows where booths are typically relocated from year-to-year completely changing the show floor map, companies at InterTabac are typically placed where they previously were, meaning that STG’s positioning of being the first booth you’d see on the right side when entering a main hall was the place it had been for more than a decade.

Davidoff’s stand at InterTabac 2017

Over the last decade, Davidoff’s presence at the trade show has varied, but in the most recent shows it has had its own booth. Like STG, the company has also used InterTabac as a time to host off-site events, including previously hosting a European version of its Golden Band Awards party—a black tie affair celebrating its top-performing retailers—during the trade fair.

Nicole Kaufmann, director global corporate communications, provided the following statement:

InterTabac is undoubtedly an important international platform and an important meeting place for the industry. However, the trade fair has changed a lot over the last few years. It has become bigger and many new tobacco products and segments have been added, with the consequence that, from our point of view, the product group of handmade premium cigars, which is key for us as producer of handmade premium cigars, has lost relevance. Based on this fact and considering that we have been able to further develop and enhance our relationship with our valued customers and partners by providing dedicated support and service in other ways, we have come to the conclusion that we will continue to attend InterTabac as guests, however, that for the time being, we will no longer have a booth at the fair.

Some readers will immediately identify that these two companies—alongside Altadis U.S.A. and Drew Estate—announced they would no longer exhibit at the PCA Convention & Trade Show in 2020. This seems to be a very different situation. First, Drew Estate will exhibit at InterTabac 2022. Altadis U.S.A.’s most direct counterpart—Tabacalera S.L.U.—does not traditionally exhibit at the trade show, but Habanos S.A.—the Cuban cigar conglomerate—will exhibit.

That said, neither decision is surprising.

Key executives at STG have made it clear over the years that they believed the return on investment from InterTabac had been waning even before the COVID-19 pandemic. Despite STG’s large presence and the acquisition of Agio, at InterTabac 2019, the company very much left open the possibility that it would not be back in 2020.

For Oettinger Davidoff AG, the company’s presence at the trade show has been far less consistent.

Around a decade ago, Davidoff was simply a section of the booth used by Arnold André GmbH & Co. KG, its then German distributor. In 2016, Davidoff announced it would take over its German distribution, which necessitated finding a new place to exhibit, so it got its own stand at the trade fair, though one notably smaller than STG, Habanos and other companies Davidoff directly competes against. While Davidoff’s presence and commitment increased in the latter half of the decade, it was pretty clear—based on the company’s presence in both sizes and days attending—that it did not prioritize InterTabac in the first half of the decade.

For those wondering, Arnold André—which did not exhibit at the most recent InterTabac show in 2019—is not listed as an exhibitor for 2022. August Schuster GmbH & Co. KG, a more than 100-year-old German cigar company, that sells its own cigars and also is the distributor for RoMa Craft Tobac, will not be exhibiting either.

Oliver Kirch of Heyst GmbH, InterTabac’s public relations firm, told halfwheel that outside of Davidoff and STG, “no other big international company from the cigar branch has questioned its participation so far.”

Kirch also highlighted that there will be more than 600 tobacco-related companies exhibiting, including 160 that will be exhibiting for the first time. Of note, InterTabac functions very different than most American cigar trade shows because cigar companies are often in the stands of their German distributor. InterTabac has added an “International Cigar Pavilion,” which will be used by several first-time exhibitors, including companies like JRE Tobacco Co.

The decisions by Davidoff and STG are one of just a number of major storylines for InterTabac 2022. It’s likely to mark a major turning point in the German cigar market given a recent announcement by Vandermarliere Cigar Family, the parent company of Oliva and J. Cortès. Earlier this month, Vandermarliere announced that it had acquired Wörmann & Scholle and Wörmann Cigars, and also entered an agreement to acquire Wolfertz GmbH later this year. These moves are being done so the company can launch a new German distribution company, which will be announced later this year. Just based on the current brands those entities distribute, that could potentially give the new company the distribution of AJ Fernandez, Alec Bradley, Caldwell, Condega, J. Cortès, La Galera, My Father, Oliva, Plasencia, Tatuaje and XIKAR in Germany. This new company is backed by Fred Vandermarliere, a man who has been as aggressive as any in terms of investing in the expansion of premium cigar businesses over the last five years. Vandermarliere also has a wide web of other relationships that could end up playing a role in the new German distribution company; for example, Oliva recently announced joint projects with E.P. Carrillo and JRE.

This will be the first InterTabac trade fair since 2019; the last two trade fairs were canceled due to COVID-19.