In March, in response to a 50% tariff threatened by the EU on American whiskey set to be introduced on 1 April, Trump said he would retaliate with a 200% tariff on champagne, taking to his Truth Social platform to warn: \u201cIf this tariff is not removed immediately, the US will shortly place a 200% tariff on all wines, champagnes and alcoholic productions coming out of France and other EU represented countries.\u201d The American whiskey tariff has not yet been implemented.<\/p>\n
That was largely the role of wine and spirits in the tit-for-tat trade war that has defined EU and US relations in 2025, a nuclear deterrent to prevent overstepping in a real trade war fought in steel and pharmaceuticals.<\/p>\n
In July, a US and EU trade deal signed by Trump and EU chief Ursula von der Leyen in Scotland, contained no decision regarding the wine and spirits industry, leaving it in a state of cautious optimism that perhaps the zero-for-zero tariff that the sector had could continue. But a few weeks later, the sector had its answer \u2013 a 15% blanket tariff on all EU goods entering the US. \u201cOver the past six months, US tariffs have been in constant flux,\u201d says Michel Drappier, managing director of Drappier Champagne.<\/p>\n
\u201cIn 2025, we have entered a new era of diplomacy in which tariffs have become a key instrument of negotiation. The 15% rate is simply the latest in a series of announcements \u2013 we have grown accustomed to this level of uncertainty. While it is certainly not an ideal business environment, we must adapt. Our main reaction came in April, when, together with our US partner, we implemented a flexible commercial strategy designed to respond swiftly to changes in tariffs. The objective has been to minimise the impact on US consumers, who ultimately bear the cost of this additional import tax.\u201d<\/p>\n
In truth, the tariff arrives in a time of relative prosperity for the category in the US. According to Sipsource 2025 data published in June 2025, while wine reached its 52nd consecutive month of volume declines in the US, prosecco and champagne were showing \u201cmodest to strong growth\u201d.<\/p>\n
\u201cChampagne is a relative bright spot in the wine industry right now,\u201d explains Zach Poelma, senior vice president of supplier strategy & insights at Southern Glazer\u2019s Wine & Spirits.<\/p>\n
\u201cWhile retail sales have declined just under a percent over the last year, volume is basically flat. As wine in general, including still and sparkling, faces declines between 4-5%. Champagne’s performance has been stabilising during the last 12 months: following two years of accelerating declines, sales began to recover in November.\u201d While not showstopping, it is encouraging that the category can rally in the current economic climate.<\/p>\n
With premiumisation, and even alcohol consumption, trends on the wane it would seem natural that a sector so synonymous with luxurious drinking would suffer. But that reputation is partly what is keeping the category afloat. \u201cWe are lucky in a way, there are fewer substitute products available for the American consumers than for some still wines from different European regions,\u201d says Julien Lonneux, international director of Vranken-Pommery Monopole.<\/p>\n
\u201cBut that\u2019s not saying it won\u2019t be difficult for us, but in more price-sensitive categories where there might be alternatives produced in the US or made in countries that have made a 0% deal, US consumers might choose the alternatives over European wines going forward.<\/p>\n
\u201cThe US has always been a very important market for champagne producers because it’s both a high-value market and a non-mature market that\u2019s growing. After France, it\u2019s the largest market for the category, and there\u2019s still room for growth.<\/p>\n
\u201cWe are in a relatively good position, because we\u2019re still seen as the most prestigious sparkling wine in the world, which should allow us to retain some volumes despite the obvious impact that the tariffs will have on prices.\u201d<\/p>\n
The US market\u2019s role as a non-mature, high-value market is instrumental to this position of the category.<\/p>\n
As Lonneux explains: \u201cThe US market differs from other mature champagne markets like the UK and western Europe. In the US, the category is still very brand led, there aren\u2019t many private labels or entry-level champagnes.<\/p>\n
\u201cThis means that the impact of similar tariffs on historic European markets would be much worse. In the US, the entry-level champagne category, which is more price sensitive, doesn\u2019t really exist, the space is occupied by relatively cheap, traditional method American or Argentinian sparkling wines.\u201d<\/p>\n
This dynamic means that champagne is still a must-stock for American retailers, despite the increasing prices.<\/p>\n
\u201cWhile champagne has a higher price, $61.70 on average, than other types of sparkling wine, like prosecco at $13.54, it also has stronger velocity \u2013 the average store sells $196 a week in champagne vs $47 in prosecco,\u201d says Poelma.<\/p>\n
\u201cWhile 75cl bottles of champagne and champagnes priced over $100 have declined this year, magnum bottles are also showing strong growth of 6.5%.\u201d<\/p>\n
But tariffs aren\u2019t the whole picture. The reality of trade between the EU and US had started to become increasingly costly before 1 September.<\/p>\n
\u201cThe exchange rate has been a big problem for us,\u201d says Lonneux. \u201cSince their arrival, the current Trump administration has lobbied for a weak dollar compared to the euro. The result of this is that our products are now so much more expensive than they were 12 months ago. Since January the impact has been massive \u2013 we\u2019re talking about a double-digit reduction in the exchange rate, so it\u2019s impossible for us to swallow and we\u2019ve already had to adapt our pricing even before the tariffs were introduced.<\/p>\n
\u201cSo clearly, with the tariffs and foreign exchange rate, alarm bells are ringing, and we will have to find other routes to sell what we won\u2019t be able to sell in the US in the coming months and years. That\u2019s a responsibility for the whole champagne category and not necessarily just us as a company \u2013 to open up new markets or further develop both existing and emerging markets.\u201d<\/p>\n
Since January 2025, the US dollar has slumped from around \u20ac0.97 to \u20ac0.85, a decline that almost equals the 15% tariff hike. So, in effect, champagne is now 30% more expensive when it arrives Stateside than it was at the end of last year. This year, producers and manufacturers from across the US and EU have been thrust into a political space far beyond the reach of their control and in the face of turbulence, it is the responsibility of these producers to navigate a rapidly[1]developing market.<\/p>\n
\u201cIn response to uncertainty, our answer is stability,\u201d says Drappier. \u201cWe believe in a single, consistent strategy, one that has shaped the reputation of Champagne Drappier over eight generations: to craft a wine that expresses our terroir, a wine we like, one we are proud to share, and to remain transparent and fair with our partners and clients.<\/p>\n
\u201cAbove all, in an ever-changing landscape, the most important response is to remain true to who we are. We are not politicians \u2013 we are winemakers.<\/p>\n
\u201cOur answer has been to continue focusing on crafting champagnes that resonate, offering something distinctive and timeless. That sense of authenticity is, we think, what today\u2019s discerning consumers value most.\u201d<\/p>\n
So far, champagne\u2019s saving grace has been its position as a wine in a league of its own. But as prices climb and money becomes tighter, it may find itself priced out of contention. However, what has been encouraging is that at present, despite rising prices and seemingly fewer causes for celebration, the US still has plenty of appetite for champagne.<\/p>\n
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