Home / Tech News / Puff, Puff, recharge. E-cigarettes are booming, and China is ground zero

Puff, Puff, recharge. E-cigarettes are booming, and China is ground zero


I walk into the Shenzhen Convention and Exhibition Center and I’m blasted by wafts of vapor. So are 36,000 other people.

A woman waves emissions away from her face as one does secondhand smoke. Disc-jockeys play tunes. Models in jean shorts, cropped shirts, and heels push marketing materials. Tattoo companies offer temporary ink. Actors don Mickey Mouse and Minnie Mouse costumes. A clown makes animal balloons.

At this year’s three-day IECIE eCig Expo, 1,000 companies from China, Germany, Japan, Malaysia, Russia, U.K., and the U.S. exhibit e-cigarettes and paraphernalia, and the biggest takeaway is the astonishing versatility on display: heating coils, microprocessors, power inductors, tube casings, rechargeable batteries, and storage boxes. Attendees puff away on samples, billowing 10-foot-long clouds.

Battery-powered e-cigarettes take various forms: standard rectangle, e-pens, e-lipstick, e-pipes, e-cigars, e-hookahs. They vaporize inhalable nicotine solutions known as e-liquids, e-juices, or oils, which are heated sans combustion, rendering them smokeless. Vaporizer cartridges accommodate dry herbs, tobacco leaves, and marijuana.

Some e-cigarettes are simple and affordable. Others are smart devices with touchscreen multilanguage menus, firmware upgrades, and power bank options. Expensive pieces are art, made with stainless steel, zinc alloy, glass, leather, and wood accent panels. Suppliers advertise uptake efficiency, compactness, versatility, customization, and ergonomic designs.

Beijing pharmacist Han Li invented e-cigarettes in 2003 and roughly nine-tenths of global production occurs in China, mostly in Shenzhen’s industrial Bao’an District, two hours outside the city center. In Bao’an, Elego Technology Company, an e-cigarette exporter, sits nestled between hundreds of manufacturers, component suppliers, and warehouses.

Attendees puff away on samples, billowing 10-foot-long clouds.

Wearing jeans, sneakers, and a black Elego T-shirt that reads “Best Vape Wholesalers,” sales representative Daisy Qiu, tells me e-cigarette aficionados clamor for the latest releases. “It is like a new fashion,” she said. “Small innovations push the market.” Team colors for the NFL Raiders, black and silver, are best-sellers.

Around the office, 20-somethings work diligently. Empty shelves and moving boxes are harbingers that the company is relocating. With revenues growing 25 percent annually and expected headcount to reach 200 by year’s end, Elego needs more space.

On one disk sit dozens of e-cigarettes waiting to be tested. As a third-party agent, Elego filters out subpar products. The company’s reps visit factories to review production processes, cleanliness, and certifications.

Sales manager Michael Li said that a few inferior batteries and user error spawned exploding e-cigarettes years ago. “But now, it never happens because quality improved,” he told Digital Trends. “The competition is very strong. So each manufacturer will try their best.”

E-Cigarette flavors

Joshua Bateman/Digital Trends

E-liquids contain nicotine, water, and propylene glycol, or vegetable glycerin. Flavors include standards like menthol and drip tobacco, as well as an immense assortment that reads like a stroll down the snack aisle: cookie, donut, ice-cream, vanilla custard, caramel, pretzel, bubble gum, mint, pina colada, wine, cola, root beer, black tea, and energy drink. Fruity varieties are punch, apple, banana, orange, peach, grape, cherry, strawberry, watermelon, pineapple, pomegranate, lychee, and kiwi. Companies highlight the flavors’ sweetness, freshness, and cleanliness.

Elego exports e-cigarettes from China, but not e-liquids. “American liquids are the most popular,” Li said.

Driven by North America and Europe, the global e-cigarette market is forecast to grow 17 percent annually, reaching $27.7 billion by 2022. Elego exports to more than 60 countries. Americans prefer larger, higher wattage e-cigarettes with heftier vapor plumes. Brits like smaller models, the French even slimmer.

E-cigarettes have barely dented the $770 billion tobacco industry, but Li thinks they could steal 30 percent market share in the upcoming decades. “New stuff, it takes time to get people to accept it,” he said.

Detecting opportunities, electronics and biotechnology conglomerates have entered the market. For example, iPhone manufacturer Foxconn Technology Group manufactures vape pods. Big Tobacco — British American Tobacco, R.J. Reynolds, Altria, Philip Morris International, and Imperial Tobacco — is also participating.

The Chinese smoke 45 percent of the world’s cigarettes, but only a sliver of those 316 million smokers use e-cigarettes. Li said Chinese people are traditional and reluctant to try alien things. Few have ever heard of e-cigarettes. He believes youth will propel acceptance, however.

“Young people, they like new stuff,” he said. “But old people, they will stay old.”

Tobacco costs encourage Westerners, but not Chinese, to embrace e-cigarettes. Unlike China, where packs of smokes can be had for less than $2 each, they may exceed $10 a pack in the U.S. and U.K., spurring the need for substitutes. Thus, Chinese adopters are the wealthy, not mass market.

Smoking is also social. When lighting up, Chinese typically offer cigarettes to others. E-cigarettes sever this connection. “This is a really big problem,” Li said.

If the government supports it, it will grow very fast. If not, we have to figure that out

Policymakers also influence market development. Because China’s e-cigarette consumption market is immaterial, officials haven’t meddled. If it cannibalizes tobacco consumption, however, additional taxes and controls could be levied. State-owned enterprise China National Tobacco Corporation is a near monopoly, manufacturing 98 percent of the tobacco products in China, throwing off approximately $150 billion annually in tax revenues.

In America, the Food and Drug Administration began regulating e-cigarettes last year and acknowledged they have both “potential benefits and risks.”

“If the government supports it, it will grow very fast. If not, we have to figure that out,” Li said.

To oust unscrupulous manufacturers, Li welcomes stronger regulations in the fragmented, unchecked industry. Assorted paints, coatings, and chemicals are used in production, which can contaminate the aerosol. Studies have found worrying levels of nickel, chromium, and diethylene glycol – an antifreeze ingredient – which can infiltrate users’ lungs.

E-Cigarette sharing

Joshua Bateman/Digital Trends

Although long-term studies are lacking, e-cigarette advocates market them as healthier alternatives to smoking. This theory is centered on e-cigarettes vaporizing solutions, which don’t burn tobacco like cigarettes do. According to a Public Health England report, e-cigarettes are about 95 percent less harmful than ordinary cigarettes. More than 480,000 Americans dying from smoke every year.

“People work so hard. Their health is not good. So, they need some stuff to cure smoking,” Li said.

One expo attendee remained unconvinced, however. In a seating area, a solitary used cigarette butt lay on the floor.

Elsewhere, other researchers have raised misgivings. Dr. Shan-shan Chung, assistant professor at Hong Kong Baptist University, studied e-cigarettes on behalf of the Hong Kong Council on Smoking and Health. Chung said e-cigarettes present different risks than tobacco products, invalidating direct comparisons.

Chung found trace nicotine in e-cigarettes, but it poses less risk than it does in traditional cigarettes. As battery-powered electronics, though, e-cigarettes contain endocrine-disrupting polybrominated diphenyl (PBDE) and formaldehyde, a carcinogen, neither of which is present in cigarettes. Amounts vary greatly by manufacturer.

Thus, when using a questionable product, “[a user’s] health is very much in danger because he or she is absorbing one proven carcinogen and one developmental toxicant,” Chung told Digital Trends.

For smokers contemplating switching, she said, “Neither smoking nor vaping is advisable. Just quit because there is no evidence showing any one is better than the other.”

Others fret over nonsmokers vaping, notably youth. After increasing 900 percent annually between 2011 and 2015, more U.S. high schoolers now use e-cigarettes than traditional tobacco products.

In a report, former U.S. Surgeon General Vivek Murthy called youth usage “a major public health concern.” Murthy wrote, “The brain of youth and young adults is more vulnerable to the negative consequences of nicotine exposure. The effects include addiction, priming for use of other addictive substances, reduced impulse control, deficits in attention and cognition, and mood disorders.”

The report conceded, however, that, “Gaps in scientific evidence do exist,” and that “these products and their patterns of use continue to change quickly.”

As governments and researchers investigate, the industry continues to mushroom. On stage at the exhibition, a boy band in white T-shirts rapped. One vaped away as another bellowed in his best Eminem impression, “Zuò hěn dàde shēngyì!” (“Do a lot of business!”)

While recognizing market maturation will take time, Li said of the industry, “It’s really a bright future.”

Joshua Bateman is based in Greater China. He can be reached @joshdbateman.






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