Corona and Modelo CEO says Trump illegal immigration crackdown is hurting beer sales in Hispanic areas

The CEO of beer giant Constellation Brands, maker of Corona and Modelo beers, has said that the Trump administration's policies to curb illegal immigration has been impacting the corporation. 

Constellation Brands CEO Bill Newlands said on Yahoo Finance's Catalysts, "Well, the consumer is concerned about a number of things ... The pricing and costs of things, inflation. They're concerned about immigration, particularly consumers that have had friends or family who have been involved with issues around immigration. How that's translating is that people are spending less. They're out less in restaurants. They're spending less on consumer goods and consumables."

"Fortunately, beer is pretty far down the list, but there's an overall concern in that [Hispanic] community. Less social gatherings ... Those are beer moments. So for us, that creates a bit of a challenge," he added.

The Trump administration has been focusing on deporting those who have come illegally to the United States, starting with those who are public safety threats as well those connected to gangs.

Constellation brands makes Corona as well as Modelo and its earnings were revealed this week, showing that the company has been struggling. According to Yahoo Finance, the company's earnings were around $12.90 a share coming in way below the projected $13.97 per share that was anticipated. The dip in sales may also be connected to a drop in consumer spending as well as Trump's tariff policies.

The Trump administration announced a 25 percent tariff on aluminum cans and canned beer being imported to the United States, according to Mexico Business. But the tariff is still in place and was not lifted for the 90-day pause. The southern neighbor to the US is expected to be hit hard as a result, as Mexico is responsible for around 81 percent of all US beer imports, as of 2023, per Statista.

Despite this, Constellation Brands is going to be making a new beer plant in Mexico instead of the US and cited being "authentic" to its brand for the reason. "While we're an American company, we're invested in Mexico because we are selling authentic Mexican brands. And the same way that you're not making champagne in the United States or you're not making tequila in the United States, or you're not making New Zealand Sauvignon blanc in the United States, we're not going to be making Mexican beer in the United States," Newlands said.