HAMBURG, N.Y. (WKBW) — A trade war between the U.S. and the European Union is escalating, which has left wine industry business owners worried about its impact on their bottom lines.
President Donald Trump on Thursday threatened a 200% tariff on European wine, champagne and spirits in response to the E.U.'s round of tariffs targeting $28 billion worth of U.S. goods. Those tariffs, which take effect in phases starting April 1, include poultry, bourbon and motorcycles among a long list of products.
This back-and-forth is causing what some call "consumer whiplash," leaving business owners uncertain about what is next.
At Alchemy Wine & Beer in Hamburg, 90% of the inventory comes from the E.U. Co-owners Nicole Casell and Anne McIntosh shared that the proposed tariff would devastate their business.
The wine bar has been a staple in Hamburg for seven years. It navigated challenges like the pandemic and now, faces another major hurdle.
"A Massive jump"
"It affects the entire industry, not just wine makers and importers. People importing are going to be subject to these tariffs that then trickle down to everyone else in the industry. It pinched distributors which puts a lot of pressure on retailers at the end of the day the price is passed down to the consumer," Nicole Casell said.
If implemented, a $30 bottle of Prosecco at Alchemy could soar to $90.
"A massive jump. It's not sustainable for a small business, and that has me worried," Casell added.
With tariffs potentially going into effect in two weeks, I asked if there is time to make adjustments.
"I think any industry, regardless, of alcohol or non-alcohol is not able to sustainably make that change," Casell explained.
Limited options for local wine
Alchemy does carry some domestic wines from California, Washington, New York and Oregon. These are also the nation's top four wine-producing states but they only make up 10% of the store's inventory.
"We have an Alchemy wine brand that comes off of our vinyard that comes out of Westfield, NY. Bringing in some local products, absolutely, which we would be doing anyways regardless of these tariffs but I don't see an option to pivot enough to be able to make up for our 200%," Casell added.
For co-owner Anne McIntosh, this is about more than numbers, it is about livelihoods.
"For us to have to pivot with a 200% increase, it's not sustainable and it's not going to happen." McIntosh explained, "Even if it's just a scare tactic, you are impacting people's lives and livelihoods. This is my job. This is her job. There's the Wine Shop, there's the Little Club on Hertel. There's Funk and Fermentation. She's brand new. This is what we do. It's not a game."
