Is Switzerland's Havana Paradise Vanishing?

[El Presidente]

Very good article shining a light on some of the current shenanigans going on. 

https://www.finews.asia/high-end/41282-switzerland-havana-cohiba-habanos-intertabak-heinrich-villiger-hong-kong

 

 

HIGH-ENDThursday, 25 April 2024 10:48

Is Switzerland's Havana Paradise Vanishing?

 

 

Written by Florian Schwab | Publishing Director

•  
•  

To date, Switzerland is the third largest market for Cuban cigars in the world. However, this status quo is currently changing, as the Cuban export monopoly «Habanos» is now cutting off supplies to Switzerland due to the priorities of the new owners in Asia. Hard times are approaching for Swiss «aficionados».

When it comes to offering handmade premium cigars from Cuba, Switzerland has so far been a kind of island of bliss.

The availability of Cuban cigars has been insufficient in this country in recent years. The background to this is production bottlenecks as a result of the Covid pandemic, coupled with storms in Cuba and economic challenges within the country.

 

In recent years, around two million Cubans (up from 11 million in 2019) have left the island, including many cigar industry employees. Production capacities for hand-rolled Havanas are currently around 60 million pieces, around a quarter lower than in 2019.

Cohiba, Trinidad, Partagas

Despite the scarcity on retailer’s shelves, Switzerland, so far, has received a comparatively generous allocation of the sought-after Cuban cigars from Cohiba, Trinidad, Partagas, etc.

The Cuban cigar industry has always held Switzerland in high regard due to their high purchasing power and the strong cigar culture with numerous lounges.

That's changing now.

«Delivery cuts»

The Swiss special-interest magazine «Cigar» recently disclosed (article in German) that «Habanos», the global marketing and sales monopoly for Cuban cigars, will «cut back» its deliveries. This policy shift will impact «several markets,» including Switzerland, particularly targeting countries where sales structures «are not 100 percent under Cubans control.»

Swiss importer «Intertabak»

In Switzerland, «Habanos» has to share the fruits of its labor with the Villiger and Lévy families, who together hold 50 percent of the exclusive importer «Intertabak» (the other half of «Intertabak» belongs to «Habanos»).

The board of directors of «Intertabak» consists of the now 93-year-old tobacco entrepreneur Heinrich Villiger, Louis-Charles Lévy as a representative of a Geneva trading dynasty and two representatives of the Cuban side.

Reduction by 40 percent 

Research by finews.com in retailer circles shows that the supply cut by «Habanos» to the Swiss importer «Intertabak» could be aproaching around 40 percent. The decision is irrefutable and can only be averted by changing the ownership structure of «Intertabak».

Similar cuts are expected for the markets of Germany, Austria and Poland, where Heinrich Villiger and his company «Fifth Avenue» (akin to «Intertabak» in Switzerland, a joint venture with «Habanos») is also the exclusive importer. Additionally, in Great Britain, where «Habanos»  shares distribution with «Hunters & Frankau», a tobacconist with over 230 years of tradition, comparative adjustments are expected. 

Handwriting of the new co-owners

Spain and France are not affected by the newly imposed shortage, where «Habanos» already skims off all the added value right up to the point of sale. The new policy shows the handwriting of the new co-owners of «Habanos». In 2020, the Hong Kong investment company «Allied Cigar Corporation» bought the 50 percent stake in «Habanos» from the British tobacco multinational «Imperial Tobacco», as part of a $1.44 billion transaction, as the trade magazine Cigar Journal reported at the time.

The beneficial owner of the «Allied Cigar Corporation» is believed to be a conglomerate of Chinese investors, led by the Chinese-born gaming entrepreneur Chen Zhi (Suncity Group Holdings), who has also had Cambodian citizenship since 2014.

Prior to this takeover, «Habanos»' business decisions were heavily influenced by Latin American norms, characterized by a great appreciation for established personal relationships.

Empty humidors in sight

Entrepreneurs such as Heinrich Villiger, Louis-Charles Lévy and Samuel Menzi («Casa del Habano» in Zurich) helped the Cubans for decades to establish the commercialization of their cigars in Switzerland. Menzi and Villiger received the «Hombre del Habano» award from cuban dictator Fidel Castro personally. This was at a time when Cubans were still orphans when it came to marketing and distribution.

But unlike a good Havana cigar that gets better with age, gratitude has an expiration date.

Cigar lovers between Geneva and Lugano are the ones who suffer most from this. The dealers' humidors will empty. And prices will rise further.

When asked by finews.asia, Intertabak neither wanted to confirm nor comment on the shortage.

 

 

 

 

 

[BrightonCorgi]

Zurich LCDH at the best of times had a so-so selection and awful service.

[Lunettesman]

7 hours ago, BrightonCorgi said:

Zurich LCDH at the best of times had a so-so selection and awful service.

Must agree. For about a year my Habanos specialist hasn't gotten almost anything. Hard even to find a D4. What a contrast with 2 years ago... Cohiba and Trinidad taking dust, full of small corona. 

[Li Bai]

This is sad news but it's no surprise...I used to buy from La Couronne in Nyon and House of Grauer too, I assume the latter won't be a place I can afford to visit regularly anymore. 😅😅

[BrightonCorgi]

7 hours ago, Lunettesman said:

Must agree. For about a year my Habanos specialist hasn't gotten almost anything. Hard even to find a D4. What a contrast with 2 years ago... Cohiba and Trinidad taking dust, full of small corona. 

Outside of Gerard and Portmann, I never had been too impressed with selection at most CH retail merchants. Never shopped at a Gesto.

[Li Bai]

6 hours ago, BrightonCorgi said:

Never shopped at a Gesto.

Gesto was the Swiss retailer all French aficionados wanted to go to a few years ago, but it no longer is.

On the other hand the House of Grauer is still a REALLY impressive place! 🤯

[BrightonCorgi]

5 hours ago, Li Bai said:

Gesto was the Swiss retailer all French aficionados wanted to go to a few years ago, but it no longer is.

On the other hand the House of Grauer is still a REALLY impressive place! 🤯

It does look impressive. I don't get to Geneva much when in CH. Zurich is closer (as family is in Biel).

[Islandboy]

Just when the average Cuban cigar consumer outside Asia thought it couldn’t possibly get worse...I really feel for anyone who’s only gotten into CC’s since the pandemic. 

[clone1008]

5 hours ago, Li Bai said:

Gesto was the Swiss retailer all French aficionados wanted to go to a few years ago, but it no longer is.

On the other hand the House of Grauer is still a REALLY impressive place! 🤯

Are you saying that their current inventory of Cubans is good?

[Wookie]

The legit Swiss grey market vendors were a dream to deal with for years. Great prices and service, guaranteed delivery. No customs hassles. Made American's lives soooo easy.

[Li Bai]

4 hours ago, clone1008 said:

Are you saying that their current inventory of Cubans is good?

They have nearly everything you could ask for, a good friend of mine who's been collecting for decades knows Mourade Hendor (their cigar sommelier) very well told me about HOG and basically if they don't have what you're looking for, you might as well stop looking for it. There are other great places of course but it's one of the top shops in the World for sure. It's not cheap to say the least 😅😅

4 hours ago, Wookie said:

Made American's lives soooo easy.

Not only Americans' 😉

[clone1008]

4 hours ago, Li Bai said:

They have nearly everything you could ask for, a good friend of mine who's been collecting for decades knows Mourade Hendor (their cigar sommelier) very well told me about HOG and basically if they don't have what you're looking for, you might as well stop looking for it. There are other great places of course but it's one of the top shops in the World for sure. It's not cheap to say the least 😅😅

Not only Americans' 😉

I am going to be near Geneva next month. Any recommendations?

[Lunettesman]

5 hours ago, BrightonCorgi said:

It does look impressive. I don't get to Geneva much when in CH. Zurich is closer (as family is in Biel).

Family in Biel? It's where I live. Feel free to pm me if you are in town. 

[ChanceSchmerr]

5 hours ago, Li Bai said:

Gesto was the swiss retailer all French aficionados wanted to go to a few years ago but it no longer is.

My first visit to Gesto in late 2014 reflected this. Meeting the owner Jean-Charles and talking for hours about the "old days" of Cuban cigars smoking and sales in Geneva (meaning the 80s/early 90s), marveling at the wonders on the shelves (ERDM Gran Coronas, French/Swiss REs from the late 2000s, etc), gratitude for the reasonable prices as I purchased those ERDM's and several other boxes I'm still smoking through today...it was an incredible place to visit for the cigar enthusiast.

Then I visited again in October 2022 on our way back to Canada from Portugal on a layover to Geneva. Couldn't be any more different. The shelves were bereft of all but the basic CCs. Prices had skyrocketed. J-C was not there that day, but his staff were perfunctory and generally passionless for conversation. It was just another cigar shop. I don't think I'll ever return.

Disappointing to read this news, if indeed accurate. HSA's new direction appears to be to skim profit at every level possible. Understandable from a pure cold business perspective, but unwelcome news to most consumers, particularly those outside of AP and those specific European markets mentioned. As if we needed any more efforts to further push Cuban cigars out of reach from all but the privileged few...

[Li Bai]

4 hours ago, clone1008 said:

I am going to be near Geneva next month. Any recommendations?

You HAVE to visit the House of Grauer (although I don't know your cigar budget) when going to Geneva, I never went to Gérard but it seems worth your time too.  

I'm fairly new here but tbh I'm a bit surprised HoG has nearly never been talked about on FOH.

[BrightonCorgi]

4 hours ago, ChanceSchmerr said:

Disappointing to read this news, if indeed accurate. HSA's new direction appears to be to skim profit at every level possible. Understandable from a pure cold business perspective, but unwelcome news to most consumers, particularly those outside of AP and those specific European markets mentioned. As if we needed any more efforts to further push Cuban cigars out of reach from all but the privileged few.....

Habanos seems to have no concept on the long dollar. Or Habanos crystal ball is that cigars will be eventually outlawed. Make hay while the sun shines.

[LOMTL]

4 hours ago, Li Bai said:

I'm a bit surprised HoG has nearly never been talked about on FOH.

 

4 hours ago, clone1008 said:

I am going to be near Geneva next month. Any recommendations?

There is a before and an after your first visit @ HOG, beware. Collection is beyond impressive, subastas, jars, pre-embargo, pre-castro, you name it. Mourade Hendor, their Habanos Master is extremely knowledgeable and passionate about what he does. I'd live there, I would have a membership for sure...Enjoy.

[clone1008]

3 hours ago, LOMTL said:

There is a before and an after your first visit @ HOG, beware.

Not sure what you mean.

[Ford2112]

I hope to visit some day. 

[LOMTL]

4 hours ago, clone1008 said:

Not sure what you mean.

I mean that you enter this place all innocent and after 20 min you are ready to remortgage your house for some rarities ahah. Really worth paying a visit.

[Marco_011t556]

So far we heard the news is: Reduction in Germany 30%, Switzerland 18% (but the article mentioned 40%), France 20%. What I heard that the main reason is the drop in harvesting...and for sure rise of Asian market.

[CaptainQuintero]

  Maybe actually they see the writing on the wall for the European market (and others) with the legislation wanting to put to an end of tobacco use. Asia is where the long term market will be so they have to pivot to there?

[Li Bai]

Well I guess lots of people from countries where CCs were already really expensive used to buy online from Swiss retailers and as prices are now more consistent all over the world, they might as well redirect the products to Asia directly, don't you think?

[loose_axle]

17 hours ago, Li Bai said:

You HAVE to visit the House of Grauer (although I don't know your cigar budget) when going to Geneva, I never went to Gérard but it seems worth your time too.  

I'm fairly new here but tbh I'm a bit surprised HoG has nearly never been talked about on FOH.

I've always loved their emails and posts. Never been but they seem to do things well... 

[Hammer Smokin']

20 hours ago, Islandboy said:

Just when the average Cuban cigar consumer outside Asia thought it couldn’t possibly get worse...I really feel for anyone who’s only gotten into CC’s since the pandemic. 

The "average" Cuban cigar smoker isn't in the focus. Cuban cigars aren't for the average person. Pathetic really - but that's only cause I'm average.