WASHINGTON — President Donald Trump on Thursday stood firm on his tariff policy, hours after threatening to escalate a global trade war with a 200% tariff on champagne and other alcohol products from the European Union.
"I'm not going to bend at all," Trump told reporters at the White House on Thursday. When asked whether he would reconsider a fresh round of tariffs set to go into effect on April 2, Trump offered a one-word reply: "No."
U.S. stocks tumbled Thursday, erasing some gains in the S&P 500 and tech-heavy Nasdaq a day earlier. The Dow Jones Industrial Average closed down 535 points, or 1.3%, while the S&P 500 dropped 1.4%. The tech-heavy Nasdaq declined nearly 2%.
Shares of large European winemakers also fell on Thursday in apparent reaction to Trump's tariff threat.
The threat of additional U.S. tariffs came after the EU announced plans to slap tariffs on $28 billion worth of U.S. goods, including a 50% tariff on whiskey. Those tariffs marked a response to U.S. duties on steel and aluminum imports.
Trump called on the EU to drop its tariff on whiskey, saying the U.S would otherwise "shortly place" a tariff on alcohol products from the EU.
Trump sharply criticized the EU, describing the organization as "one of the most hostile and abusive taxing and tariffing authorities in the World."
In a post on X, French Trade Minister Laurent Saint-Martin said: “Donald Trump is escalating the trade war he chose to unleash. France remains determined to retaliate together with the European Commission and our partners. We will not give in to threats and will always protect our sectors.”
If Trump moves forward with his tariff threat, the move could have a significant impact on American consumers.
The US is the world’s largest importer of wine and champagne. The US imported nearly $4.9 billion worth of Wine each year, with $1.6 billion imported from France, according to World Bank Data. In 2023, the US imported more than $1.7 billion worth of champagne.
The Distilled Spirits Council of the U.S. is urging the U.S. and EU to come to a resolution that gets the industry back to “zero-to-zero tariffs.”
“This is a model that has allowed spirits exports between the U.S. and EU to flourish and is in line with President Trump’s vision for fair and reciprocal trade,” the council’s President Chris Swonger wrote in a statement.
In his first term, Trump also targeted the alcohol industry. A series of tit-for-tat tariffs hit alcohol products in the U.S. and the EU. The Biden administration suspended those tariffs, but now the industry is once again in the crosshairs. The industry has still been recovering from that first tariff spat.
For the past three years, “U.S. distillers have worked hard to regain solid footing in our largest export market,” Swonger added.
The tariff threats on Thursday mark the latest skirmish in a global trade war. In response to U.S. duties on steel and aluminum, Canada announced retaliatory tariffs applied to $20.7 billion in U.S. goods, government officials said. The U.S. imports more steel and aluminum from Canada than from any other country.
The Trump administration last week slapped a 10% tariff on China, doubling taxes on Chinese imports to 20%. In response, China imposed retaliatory duties on U.S. agricultural goods, deepening a trade war between the world's two largest economies.
The trade tensions triggered recession fears on Wall Street. Goldman Sachs last week hiked its odds of a recession from 15% to 20%. Moody's Analytics raised its gauge of the probability of a recession to 35%.
This is a developing story. Please check back for updates.
Copyright © 2025, ABC Audio. All rights reserved.
