Reims (France) (AFP) – US President Donald Trump’s threat of 200-percent tariffs on wine, champagne, and other alcoholic drinks from EU countries is proving hard to swallow in France’s champagne region. The move, announced in retaliation for the European Union’s planned levies on American-made whiskey, would triple the price of even an entry-level bottle of champagne for US consumers to around $150, enough to make even well-off customers think twice.
“I don’t even want to imagine that it could come to that,” said David Chatillon, co-president of the region’s Champagne committee industry body. He told AFP that while Trump might be unconcerned about the impact on the French sector, there was hope that he might listen to American distributors, “75 percent of whose margins are generated through European wines and spirits”.
The United States is the biggest export market for champagne, made exclusively in its home region in eastern France, with close to 30 million bottles valued at 810 million euros ($880 million) shipped there in 2023. That is comparable to champagne sales in the entire European Union, said Simon Lacoume, sector analyst at the Coface financial company, and represents about six percent of global champagne demand.
Vitalie Taittinger, president of the iconic champagne house that exports up to 800,000 bottles to the US each year, said she hoped long-standing historic ties between France and the United States would prevail over short-term turbulence. “The timeline for champagne is long,” she told AFP. “Last century, many Americans fought for freedom and died in the Champagne region,” she said. “What has united us throughout history is stronger than what is happening right now.”
– ‘Taken hostage’ – One American on a visit to the champagne capital Reims, Brooke Burgess from Washington DC, told AFP that she bought French wines or champagne at least every other week, which would become “cost-prohibitive” if the tariffs came into force. But while Trump’s threat was “very unfortunate”, she said it was hard to believe it would stick. “Trump goes back and forth on threatening tariffs, so we will see what happens, but at this point I’m not too worried,” she said.
Meanwhile, many industry representatives are fuming at the European Commission, which handles trade matters for member countries, accusing it of failing to protect the sector. Ever since a trade row during Trump’s first term, “we have continuously asked the Commission…to ensure that wine and spirits are not taken hostage” in fights over trade, said Chatillon, calling for transatlantic drinks duties to be cut to zero.
Luxury giant LVMH, which owns major champagne houses including Moet and Ruinart and whose boss Bernard Arnault was a guest at Trump’s inauguration, declined to comment. Smaller champagne houses are especially vulnerable to any tariff rise, said Christine Sevillano, an organic grower and president of the association of independent champagne producers, whose sales depend for about a third on exports. “Bigger houses probably have the solid finances needed to reorient sales,” she said, adding that she hoped politicians “on both sides of the Atlantic” would step in to stop any further escalation.
French Finance Minister Eric Lombard, calling the budding trade war “idiotic”, said Friday that he would travel to Washington soon. “We need to talk to the Americans to bring the tension back down,” he said.
© 2024 AFP
