LOS ANGELES Philip Morris USA on Wednesday effectively raised the price of its Parliament brand cigarettes by 15 cents per pack and the price of its Virginia Slims brand by 20 cents per pack.
A spokesman for the largest U.S. cigarette company said that from January 7 through February 24 it will cut the promotional allowances it gives wholesale distributors of Parliament and Virginia Slims.
Reductions in promotional allowances are typically passed on to consumers in the form of higher prices. The average price for a pack of cigarettes can vary widely due to differences in local taxes.
Philip Morris will reduce the Parliament promotional allowance by $1.50 per carton to $2 per carton and eliminate the $2 per carton promotional allowance on Virginia Slims, the spokesman said.
Parliament and Virginia Slims had U.S. retail market shares of 1.9 percent and 2.2 percent, respectively, in the third quarter of 2007. During the same period, Philip Morris' core Marlboro brand had a 41.1 percent share of the U.S. retail market.
Philip Morris is a unit of Altria Group Inc (MO.N).
(Reporting by Lisa Baertlein; editing by Gary Hill, Richard Chang)