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Canadian booze ban set to have major impact on duty-free stores

Peace Bridge
WBEN

Buffalo, N.Y. (WBEN) - To most Western New Yorkers, stopping at the duty-free stores in either Buffalo or Southern Ontario is as natural as drinking water or breathing air.

But now an edict from U.S. President Donald Trump may put an end to that, and no one is happy.


In his latest salvo - in his trade and tariff war with Canada - Trump has said effective Sept. 29, he is banning any Canadian-made alcohol from entering the U.S. The ban also extends to dairy products and motorcycles, while he is also adding a new 50% tariff on Canadian-made mattresses, golf carts and motorboats.

The ban comes just a few weeks after Trump signed an Executive Order to rebrand Lake Ontario to "Lake America" - a move that has drawn large amounts of local and national criticism.

Former Buffalo Mayor Anthony Masiello, now chairman of the Buffalo & Fort Erie Public Bridge Authority - the binational board that oversees the Peace Bridge - said Trump's pending ban on imported Canadian alcohol is "nonsense and counter productive."

The Peace Bridge Authority recently signed a new contract with Duty Free Americas to continue to run its deep discount retail operations on the bridge's plaza.

Masiello is concerned if duty-free's sales drop because of the ban - coupled with a weak Canadian dollar and general anti-Trump pushback from Canadians - may result in a bottom line decrease.

"Buying from Duty Free is a tradition around here," Masiello said. "The president is creating a reaction that may take a long time to overcome,"

Dan Flefinger, Duty Free Americas vice president of operations, said his company is already seeing a drop in Canadian sales that's approaching 25% in certain locations, including its sales at he Peace Bridge, the Rainbow Bridge in Niagara Falls and Lewiston-Queenston Bridge in Lewiston.

Duty-free has more than 250 locations across the U.S.

"It [Trump's ban] is a big unknown," Flefinger said. "At first glance, we are looking at the proposal is very open ended."

Sales at the Buffalo/Southern Ontario border crossings are major contributors to Duty Free's bottom line.

"Some of the biggest percentages of sale are from our Buffalo area customers," Flefinger said. :It outpaces a lot of other locations both east and west."

It is not uncommon for Americans heading back home from Canada to stop at Duty Free to buy such beers as Molson, Labatt's, Moosehead or Alexander Keith or such liquor as Woodford Reserve bourbon, Crown Royal or Four Roses Whiskey.

And for Canadians headed back home, they load up on Budweiser and Michelob Ultra.

"For now, we are taking a wait-and-see stance," Fleflinger said.