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 worldwide availability of Cuban cigars has been insufficient 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.