The American alcohol industry giant predicts that the aluminum tariff will result in a loss of 20 million US dollars
July 7, 2025
Constellation Brands, a major US alcohol company, expects that the 50% tariff on imported aluminum imposed by the Trump administration will increase its costs by approximately 20 million US dollars in the current fiscal year (ending in February 2025).
Although alcoholic beverages in Mexico still enjoy exemptions, beer packaged in aluminum cans is subject to new tariffs, which directly affects the profit margins of companies.
The company's chief financial officer, Galls Hankinson, said that although the first-quarter performance was not affected, the subsequent profit margin would shrink by about 20 basis points, and the company would find it difficult to fully pass on the costs.
The beer business remains the main source of profit for Constellation brands, but rising costs and weak demand are squeezing profit margins.
Bill Newlands, the company's CEO, pointed out that the reduction in consumers' dining out and family social activities has led to a contraction in beer consumption scenarios, but the demand itself has not declined.
The company's share price has fallen by 31% so far this year. This tariff has intensified the pressure on American enterprises that rely on imported aluminium, while Canada, as its main supplier, its aluminium investment (such as the $1.1 billion upgrade plan for Aluminerie Alouette) may help stabilize the supply chain.
