To remove excess wine and aid producers, the French government is giving €200 million (£171.6 million).
It comes amid a medley of issues facing the sector, including a decline in wine consumption as more people turn to craft beer.
The industry is also being impacted by overproduction and the challenge of rising living costs.
The majority of the €200 million will be spent on purchasing extra inventory, with the alcohol being sold for use in things like hand sanitizer, cleaning supplies, and perfume.
Additionally, money will be made available for winegrowers to switch to other products, such as olives, in an effort to reduce overproduction.
According to Agriculture Minister Marc Fesneau, the French government wants to prevent “prices collapsing… so that wine-makers can find sources of revenue again” by investing the money in the sector.
Despite the financial support, which came in the form of an initial EU budget of €160 million that the French government increased to €200 million, he continued that the wine business must “look to the future, think about consumer changes, and adapt.”
According to figures from the European Commission for the year ending in June, wine consumption has decreased 7% in Italy, 10% in Spain, 15% in France, 22% in Germany, and 34% in Portugal, while wine output in the EU as a whole—the largest wine-producing region in the world—rose 4%.