American brands like Coke and Jim Beam are paying the price abroad for Trump's trade war

Yahoo

11-05-2025

Backlash to tariffs and other US policies has hit some of the biggest American brands.
Some shoppers abroad are avoiding products like Coca-Cola and Jim Beam, given their ties to the US.
Not all American brands have been affected to the same degree, however.
For some people abroad, a Jim Beam and Coke isn't going down as easily as it once did.
Companies that make some of the biggest American brands have noted different degrees of pain as some consumers overseas avoid their products in protest of President Donald Trump's trade war.
Globally, consumers are less likely to buy many major US brands than they were just a few months ago, survey data published late last month by Morning Consult found.
"This suggests that overseas consumers are uniquely singling out some American brands due to their country of origin," the report says.
US companies already face plenty of problems because of tariffs, mostly in the form of snarled supply chains and higher import costs. The backlash abroad points to another issue: What happens when a brand's connection with America starts becoming a liability instead of a selling point?
In Mexico, for instance, the share of customers who said they were "absolutely certain" to buy a Coca-Cola product in the near future fell from 40% in January to 28% in February before rebounding to 34% in April, according to Morning Consult data.
Coca-Cola CEO James Quincey said that some Latino consumers in the United States and in Mexico pulled back on their purchases of the company's products during the first quarter after videos circulating on social media in February said, without evidence, that Coke had reported some of its own employees to US immigration authorities.
Quincey said that the videos were "completely false, but they impact the business" anyway.
McDonald's CEO Chris Kempczinski said during an earnings call last week that the fast-food chain didn't see a hit from diners abroad pulling back in results during the first quarter. But the chain did note an uptick in anti-American sentiment generally, he said, especially in Canada and Northern Europe.
"What we have seen in our survey work is that there has been an increase in people in various markets saying that they're going to be cutting back their purchase of American brands," Kempczinski said.
Since the start of the year, Japan-based Suntory Holdings has been bracing for a hit to Jim Beam and Maker's Mark, two American whiskey brands it owns.
Suntory expected that in 2025 American products would be "less accepted by those countries outside of the US because of first, tariffs and, second, emotion," CEO Takeshi Niinami told the Financial Times in February. Suntory did not respond to questions about how the whiskey brands have performed in recent months.
Instead of buying products associated with the United States, foreign consumers could shift their spending to local brands. That's already happening in Canada, where shoppers are eschewing US products at grocery stores and other retailers in favor of Canadian-made equivalents.
"The risk for US brands is that consumers' growing antagonism toward the United States resulting from an onslaught of tariffs emanating from Washington will cause them to seek out alternative goods and services provided by local and foreign (non-U.S.) brands," Morning Consult wrote in its April report.
Not all big US brands that sell abroad are feeling the same pinch.
Tapestry, the company that makes luxury purses and other accessories under the Coach and Kate Spade New York brands, said on Thursday that it wasn't seeing any sales slowdown due to anti-American sentiment abroad.
Levi Strauss & Co., the jeans brand, said that its sales haven't been affected either.
CFO Harmit Singh said on an earnings call in April that "we're entrenched with the local consumers" in other countries. He added that in some international markets, Levi Strauss has been selling jeans for several decades.
"Right now, international business is fairly strong," Singh said.
Read the original article on Business Insider