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President Trump’s 200% tit-for-tat tariff threat on EU alcohol is causing panic in France’s already weakened champagne industry.
The French champagne industry is bracing itself for a major blow after US President Donald Trump threatened on Thursday to slap tariffs of up to 200% on European alcohol if the EU’s new 50% tariffs on bourbon are not lifted. The US is France’s top client when it comes to champagne exports with 25 million bottles shipped across the Atlantic last year. In 2024, France exported €3.8 billion worth of wines and spirits to the United States, representing a quarter of its total exports.Trump’s threat in a tit-for-tat escalation of the transatlantic trade war is causing panic among those who work in the already weakened champagne sector. Champagne sales have been sinking for more than two years as inflation-weary consumers both in France and abroad cut back due to the rising prices. The total number of champagne exports decreased by nearly 10% last year. At home, the demand for the beverage also dipped 8%. Champagne alternatives gaining popularityThe champagne region is also struggling with climate change and extreme weather events such as high heat and early frosting. This has resulted in smaller harvests for wine growers, further raising the price of champagne. It’s a trend Agnès Baracco, the owner of a wine shop in north-eastern Paris, has noticed in the last few years. “I sell champagne, but over the last two years, prices have gone up a lot, and customers are turning their backs,” she told Euronews. “When I first opened the shop fifteen years ago, my cheapest champagne was around €20. Today, I sell it for €27 because I trim my profit margin when I could sell it for more,” she explained. Instead, she claims her clients are turning to other bubbly alternatives like a sparkling Vouvray wine that she sells for approximately €10. “It’s my best seller. And coincidentally, it’s not expensive,” she exclaimed. Other more affordable alternatives such as Italian prosecco, Spanish cava, and French sparkling wines are threatening the champagne sector both on the local and international market. Time for changeAccording to Jean-Marie Cardenat, an economist and expert in the wine industry, it’s a much-needed wake-up call for the champagne sector. “Perhaps we need to accept the fact that champagne, which has enjoyed a form of monopoly for several decades, is no longer in that situation whether it’s on the French market with the rise of crémant or on the international market, with cava and prosecco now competing with champagne,” he told Euronews. “I think the way forward for the sector undoubtedly lies in a slightly renewed marketing approach,” he said. For the moment, both the EU and France seem unwilling to back down in the transatlantic trade spat. The French Federation of Wine and Spirits exporters said they’re “fed up with being systematically sacrificed” in the wake of the trade war. But French Trade Minister Laurent Saint-Martin said on Thursday that his country would “fight back.”“We will not give in to threats and will always protect our industries,” he wrote in a post on X.
