The beer sales of the owner of Modelo Especial, Constellation Brands, take a hit because the demand of the Hispanic populations in the key states slows down in the midst of Trump’s repression against immigration, the leaders of the company announced on Thursday.
President Trump launched a repression of radical immigration after taking office in January, increasing pressure on Hispanic consumers overwhelmed by higher prices of food and other essential elements as well as high unemployment rates.
Modelo ESPECIAL is manufactured exclusively in Mexico, and is imported and marketed in the United States by Constellation brands.
The brand has appreciated enormous popularity in the past two years, exceeding Bud Light as the best-selling beer brand in the United States in 2023.
However, the momentum is now discouraged, the constellation noting a significant drop in demand in its highest states of sale and its postal codes with larger Hispanic populations.
After closing the markets on Wednesday, the brewer projected an annual adjusted benefit smaller than expected, expecting abrupt prices to weigh on his business.
Latinos customers, who represent about half of Modelo’s customers, fell social gatherings – a key opportunity for beer consumption, according to the CEO of Constellation Brands, Bill Newlands.
“The efforts to go to restaurants, to have social rallies, things that are a lot of beer opportunities, have softened in the more recent term,” he said when he calls in the fourth quarter.
The beers of the Constellation brands benefit from the highest level of loyalty among Hispanic consumers compared to any other large supplier of beer in the United States, said the company in its prepared remarks.
Newlands said that business research has also revealed that Hispanic consumers were under pressure from job losses in industries with a high Latin employment base.
“We believe that the rapid change in your / perspective reflects at least partially the probable reality that the company had in recent years from the loose immigration policy,” said JPMorgan analyst Andrea Teixeira, in a note.
Meanwhile, a 25% sample on aluminum and other larger rates under the Trump administration also threaten to lead to price increases for these beers.
