Big-bucks wines feel recession's pinch
Famous - and pricey - bottles are gathering dust as customers are seeking out cheaper "value" wines.
LOS ANGELES - In most years, store manager Diana Hirst considers herself lucky if she can snag six bottles of $265 Araujo Napa Valley cult Cabernet Sauvignon to stock in her Costa Mesa, Calif., wine shop.
This year she can get dozens -- a sign of how the Wall Street meltdown is rippling across wine country, from the alluvial fields of California's Napa Valley to the chalky limestone vineyards of Champagne in France.
Sales of high-end wine are plummeting, according to wine merchants, and once-rationed top California Cabernets are in ample supply. The coveted 2005 Chateau Mouton-Rothschild from Bordeaux is languishing on store shelves for $549, an astronomical price for less than a quart of fermented grape juice. That's a bargain, though -- the wine was being sold for double that price just a few months ago.
And Champagne -- that universal symbol of largesse? Sales have plunged because of "the state of the economy," said Randy Kemner, owner of Wine Country in Signal Hill south of downtown Los Angeles.
People haven't stopped drinking wine. They are just spending less.
$9.99 is a good price point
"I still drink wine with my wife every night, but before I might have bought Santa Barbara County pinot noirs for $20 to $30. Now I am paying $9.99 for a Castle Rock pinot from Mendocino County," said Pablo Urquiza, a freelance television producer who lives in coastal L.A.
He's not alone.
Sales of wine for $9 or less make up the fastest-growing segment of the wine market while sales above that price are starting to trend down, said industry analyst Jon Fredrikson of Woodside, Calif.
Consumers are trading down to wines they consider "values," Fredrikson said.
Kemner of Wine Country is trying to get ahead of that trend. Last month he went on a shopping spree at supermarkets in California, where wines share shelf space with groceries. He purchased about 50 bottles of mass-market "corporate wines of the type we usually don't sell," he said.