Tariffs, immigration rhetoric are a double whammy for Modelo maker’s business

The American company that sells popular Mexican imported beers in the US said President Trump’s tariff threats and aggressive immigration enforcement are weighing on its business.

Constellation Brands, which sells Modelo and Corona, on Wednesday reported a downbeat outlook for the year as tariffs on the aluminum cans that encase its Mexican beers are set to take effect and its biggest consumer, Hispanics living in the US, are pulling their purse strings. The company forecast earnings per share of $12.60 to $12.90 for its fiscal 2026, which runs through February, compared to the $13.94 analysts polled by FactSet were expecting.

On a Thursday earnings call, CEO Bill Newlands also said it’s seeing pressure on the Hispanic consumer — which accounts for over half of its sales of Mexican beers — over the “many issues that follow them.” Its market research shows they are concerned about inflation, “immigration issues,” and job losses in particular industries.

“The fact is, a lot of consumers in the Hispanic community are concerned right now,” Newlands said. “Things like social gatherings, an area where the Hispanic consumer often consumes beer, are declining today as part of these overarching concerns that they have. All of that has had impact on our business.”

Trump’s tariffs policy has kept businesses that rely on imports on their toes, changing constantly, including right before Constellation released its results. It’s unclear what the tariff rate is on beer imports from Mexico, the Brewers Association wrote in a note Wednesday night.

Constellation Brands is pricing in tariffs on the aluminum cans its beer comes in, not the beer inside the cans, which is a “best case scenario,” Roth Capital Partners analyst Bill Kirk told Yahoo Finance. “That is a manageable amount,” he said. “If that is in fact the case, tariffs aren’t as bad as feared for Constellation.”

Generally, booze companies are struggling with lower demand for alcohol — beer in particular. Constellation’s strongest brands are its Mexican beers, with Modelo being the most popular beer in the US by sales. That said, its year-over-year beer volume growth has been shrinking in recent quarters and went red in the first three months of this year.