Hundreds of employees at French cognac maker Hennessy, part of the LVMH group luxury empire, went on strike on Tuesday to protest the brand’s plans to work to avoid Chinese tariffs imposed in a dispute with the European Union.
France’s CGT and FO unions said around 500-600 workers in the Charente region, home of cognac in southwestern France, were protesting an experimental plan to export the drink in vats instead of bottles, which would be subject to a 35 percent surcharge. will go
“Management told us that they want to test the product for future bottling in China through a service provider to export the product to Watts,” Frédéric Merceron, FO representative at Hennessy, told AFP. Will not live in France.
“We can clearly see the impact on employment,” he added, describing the news as “cold rain”.
“This is a first for a major house. It’s a real spanner in the works,” said Matthew Devers of the CGT union, predicting that other cognac producers would follow suit.
The strike at the Hennessy plant in the town of Cognac, which employs 1,100 people, is deadlocked, although a source close to Hennessy said on condition of anonymity that “negotiations are possible.”
Since October 11, China has required importers of European brands – of which cognac represents 95 percent of the total – to submit a deposit or bank guarantee letter to Chinese customs authorities.
The measure is part of what Beijing describes as an anti-dumping investigation. But the move is widely seen as retaliation for the European Union imposing tariffs on electric car imports from China, Cognac’s second-largest export market.
Devers said the first test deliveries, scheduled for late 2024, will determine if the quality of the beverage is maintained after transportation.
He described as “outlandish” the suggestion that materials including glassware, labels, corks and boxes should be shipped to China with the drinks and then bottled there.
France’s umbrella cognac producers’ association BNIC said it did not want to comment on the companies’ individual strategies.
But he added: “It should be clear that while awaiting a negotiated settlement, and given the deterioration we have noted, some homes may be forced to explore all avenues they can find.” to allow us to maintain our presence in the Chinese market.”
The cognac industry, which is heavily dependent on exports, now fears it will be targeted in the United States, its biggest market, following the election of Donald Trump, who plans to raise customs duties across the board. intend to
