France's Cognac industry urges EU to delay China EV tariffs

Fears over tit-for-tat measures between China and the EU, stemming from the EU's plan to impose tariffs on Chinese electric vehicles, have spilled over into France's Cognac industry.

Around 800 protesters, riding tractors and carrying signs, gathered in the southwestern town of Cognac this week, demanding a delay to the upcoming European Union vote to impose duties on Chinese electric vehicles. They fear retaliatory tariffs from China if the dispute escalates.

"The situation is urgent," said Anthony Brun, union head for Cognac's brandy makers, adding that the decision to levy tariffs on Chinese EVs "will jeopardize the entire industry."

"For a year now, we have been warning French and European authorities about this risk and the need to stop this downward spiral," Brun wrote in a letter to French Prime Minister Michel Barnier regarding the tariff threat.

"We are the victims without being in any way responsible. We have not been listened to," Brun added, writing on behalf of the Cognac union.

The potential loss of the Chinese market could be existential for some brandy producers, who rely on overseas consumers for up to 60 percent of their profits.

China imported more brandy than any other spirit in 2022, with most of it coming from France, according to a report by research group Daxue Consulting.

Cognac producers are urging the EU to postpone its September 25 vote on tariffs on Chinese EV imports, fearing China will retaliate with duties on European brandy.

"We have no way out," said Rodolphe Texier, a member of a farmers' union in the Charente region of western France.

"If Europe doesn't follow us, we're dead," Texier said, expressing concern about the widespread repercussions throughout the industry, which could affect everyone from distillers to barrel makers to truck drivers.

With over 4,400 farms and around 85,000 jobs, France's Cognac industry is already struggling after a 22 percent drop in sales in 2023 and significantly reduced new vine planting zones.

(With input from AFP)