Wine Consolidation in the U.S. is a Non-Story
I don’t’ buy it. What’s all this talk of "consolidation" of America’s wineries?
While the total cases produced by the various wineries and labels owned and marketed by corporate wineries is huge, the number of brands (and partcularly the number of quality-oriented brands) controlled by corporate interests is miniscule compared to the number of American wineries from which you can buy great wine.
Wine Business Monthly recently announced, "an overriding theme in the wine industry in 2004 was consolidation."
I’m not so sure it was a theme as much as consolidation was the word used to describe a couple high profile purchases in 2004. Constellathttp://www.blogger.com/img/gl.link.gifion Brands got the Mondavi (the Icon), The Wine Group got Golden State Vintners (suppliers of bulk wine) and Diageo got the Chalone Wine Group (a collection of fine, medium-sized wineries). There you go…that’s the "consolidation".
Consider the observation of Ste. Michelle Wine Estates President and CEO Ted Baseler: "We’re still such a phenomenally fragmented business category. Most categories are tremendously consolidated. I don’t think we’re ever going to have that inn the wine business, but having a few large companies that drive the category is probably not unhealthy at all."
He’s right. Large wine companies create economies of scale, resulting in more competition among large producers, all leading to better value for those who just want to drink wine and not think about it. For those who do want to think about wine while they are drinking it, there are more choices of true artisan wineries than ever before.
Consolidation, in the overall scheme of things, is of very little consequence for the hard core wine lover. But, let’s look at it.
Who owns wineries that were once independent, quality producers before being purchased?
The Wine Group
For those of us who prefer to delve into fine, artisan wines made by committed winemakers, consolidation is a non-issue. The only winery on this list that you have to be concerned about, and hope and pray it remains what it always was, is Gary Farrell.