The rise (and hard fall) of tequila

Mexicans trademarked the word 'tequila' like French champagne, controlling the entire category. Patrón repositioned it as 'the world's most luxurious spirit' — not tequila. Then George Clooney made it a lifestyle symbol, selling Casamigos for $1B in four years.

The agave plant takes 5-7 years to mature, creating wild boom-bust cycles. High prices in the boom years led to overplanting. By 2023, Mexico had half a billion liters of oversupply — a full year's production sitting idle. Inflation priced consumers out, premium sales dropped for the first time ever, and then Trump's 25% tariffs hit.

Price wars have begun. Casamigos cut prices 20%. Panic buying cleared shelves before tariffs, but that demand will crater next. Suppliers are struggling. The boom is over, but the cycle will turn again.