President Donald Trump's metal tariff proposal has roused an unexpected foe: the maker of Jack Daniel's.
Brown-Forman Corp., which makes the iconic Tennessee whiskey, won't feel much of a direct impact from the levies -- its biggest drinks are packaged in glass, not cans. But American whiskey was drawn into the fire when the European Union announced it would retaliate with tit-for-tat tariffs on American goods, including bourbon, denim and motorcycles.
That's led Brown-Forman to strongly oppose the tariffs, CEO Paul Varga said in a call with analysts on Wednesday.
"Brown-Forman could be an unfortunate and unintended victim of the policy," he said. "The overwhelming majority of our products are made here in America and over the last few years, I'd just cite, we've been investing heavily in our American manufacturing expansion."
The trade battle is an example of how the tariffs could affect an broader swath of industries than those with aluminum and steel in their supply chains. Bourbon accounted for about a fifth of total U.S. spirits exports to the EU in 2017, according to the Distilled Spirits Council of the U.S., a trade group.
This isn't the first time that the maker of Jack Daniel's and Woodford Reserve bourbon has been pulled into the political fray. In 2014, the company found itself in the middle of a spat between the U.S. and Russia.
"It's not new to Brown-Forman to periodically have things in the macroenvironment arise," Varga said. "We're going to monitor the potential for retaliatory tariffs closely. And of course, we're sharing our point of view in Washington, as well."
-- Bloomberg News