Philip Morris Germany has announced the closure of its cigarette plant in Munic by 2009.

The plant’s production volumes will be shifted to the plants in Berlin and Dresden. According to the company the concentration on two production sites is a result of a worsening business environment. Since 2002 total sales of cigarettes in Germany had plummeted by 32 per cent. The reason for the decline is seen in five consecutive tax increases.
Even though Philip Morris was able to maintain its position as market leader the decline in consumption has led to significant production overcapacities on the German market.
The company accounts for 37.1 per cent of the total market with brands such as Marlboro, L&M and Next. (pi)