Callaway Winery Going ‘Coastal’
Devastation in the vineyards of Temecula Valley is forcing one of California’s largest wineries to look to the Central Coast for its grapes and rename its brand to reflect the shift.
Callaway Vineyard & Winery will begin selling wine this fall under its new Callaway Coastal label. Over the next few years the Central Coast--a region Callaway believes holds a greater cachet with consumers--will become the source of most of its grapes.
Although Callaway’s parent, Allied Domecq Wines USA, intends to keep the winery itself and some vineyards in Temecula--at least for the immediate future--it says it will need to buy most of its grapes elsewhere to meet its goal of a million cases a year.
Experts say Temecula’s ability to survive as a wine-making region is in question as Pierce’s disease, a bacterial infection spread by a flying pest known as the glassy-winged sharpshooter, has spread through the area’s vineyards.
About a quarter of Temecula’s 3,000 acres of wine grapes have been ravaged since the glassy-winged sharpshooter moved in about three years ago. And experts suspect that almost half of the valley’s vines could now be infected, making it difficult for most wine makers over the next few years to produce wine.
“Its rapid spread speaks of devastation,” said Matthew Blua, an entomologist at UC Riverside. Although researchers, funded by millions of dollars from the state and federal governments, are experimenting with various methods of containing the spread of the disease, none has yet proved effective.
“It’s not a situation where it’s going to get better any time soon,” Blua said. “In two years it could devastate the wine industry there.”
Almost a fifth of the 720 acres that Callaway leases have been damaged by the disease. Some sections of the vineyards have been plowed under, and the winery has no plans to replant them until researchers can come up with a resistant strain of grapes or an effective treatment, says John Falcone, Callaway’s general manager.
Meanwhile, the Callaway brand, founded about 30 years ago by golf club magnate Ely Callaway, has continued to thrive. Its Chardonnay is now among the top 20 selling brands with almost half of its grapes being shipped in, some from as far north as Monterey County, according to the winery.
Many industry observers say the Callaway brand has just outgrown Temecula and is seeking to distance itself from the taint of Pierce’s disease.
However, the company said it has for years planned a switch to add the “Coastal” label and sourcing because it believed it was easier for consumers outside California to relate to and because vineyards in Temecula were unable to meet its demand, especially the red wine grapes needed for its new varieties.
“We saw in Callaway a brand that could really break through and become a major national brand,” said Mike Jellison, president of Allied Domecq Wines USA. Currently 60% of the wine’s sales are in California.
To broaden the wine’s appeal, Allied Domecq has redesigned Callaway’s label in breezy pastels, drawing inspiration from everyone from Martha Stewart to Pottery Barn, added quotes on the corks and tweaked the formulas for its light-tasting wines, which sell for $8 to $12 a bottle.
The company is also launching a $4-million campaign this fall with ads that appear torn from the pages of a women’s magazine. They will feature beach scenes and casual decor and the slogan, “Coastal Standard Time.”
“People associate Temecula with wines of inferior quality,” said Steve Wallace, owner of Wally’s, a wine retailer in Westwood. “Now they have an opportunity to associate with a higher appellation [area.] It’s a brilliant marketing strategy.”
Industry observers say the coastal make-over is a blow to Temecula and its reputation as a wine-making region. And an eventual shift in its operations could cut into the industry even more. Callaway is not only the largest winery there, it buys grapes from area growers. Its tasting room, restaurant and tours help fuel tourism.
“It’s definitely a blow [to Temecula],” said Jim Laube, senior editor of Wine Spectator magazine. “A lot of us hope that the other wineries there can survive and find a cure for Pierce’s disease that won’t ruin that part of Southern California’s heritage.”
However, Temecula vintners say it is a little early to sound the death knell for the area’s wine industry. Few have yet to lose so many vines that they can’t make their wines, and there is no way to calculate how quickly the disease will spread since no large-scale survey has yet been done.
“Any epitaph on us is pretty premature,” said Peter Poole, president of Mount Palomar Winery and the head of the Temecula Valley Winegrape Growers Assn. “There’s still a lot of healthy, operating vineyards out here.”
More than a century ago, Pierce’s disease destroyed 40,000 acres of grapes in the Anaheim area, wiping out its wine industry. That infestation, however, was spread by a native sharpshooter. Experts say the glassy-winged sharpshooter is an even more effective carrier of the disease.
Callaway’s Falcone said fighting the spread of Pierce’s disease and importing grapes from such areas as Monterey, Paso Robles and Santa Barbara raised the winery’s expenses about 30%.
Initially, the winery will get grapes from both the Central Coast and Temecula. However, if Allied Domecq quadruples annual sales of the brand as planned to a million cases over the next eight years, Temecula will make up only a small part of that production.
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The Grape Reaper
Pierce’s disease, the result of bacteria borne by glassy-winged sharpshooters, has taken a big bite out of Callaway Vineyard & Winery’s grape acreage in the Temecula area of Riverside County. Callaway is moving its grape sourcing north, but the bugs are headed that way too.
