It’s a game of few laughs, Sir Alex
Sir Alex Ferguson – soccer genius, gum-chewer and mind game player extraordinaire – wants to go into the wine business when he retires. The story emerged in the News of the World last weekend, so it should be treated with a degree of scepticism, but it sounds credible enough. Sir Alex used to swap bottles with José Mourinho when the Special One was at Chelsea and is a keen wine collector, apparently.
According to an unnamed friend, Sir Alex is planning to set up a company importing top-end wines from France once he’s abandoned the dug-out for good. More intriguing still, he has plans to buy his own vineyard. Can you imagine him standing, red-faced, behind a counter at a trade fair pouring his wine to mixed opinions? There must be at least a dozen Premiership referees who would pay to taste (and criticise) it.
Sir Alex is ideally qualified in at least one respect: he’s very rich. The Manchester United supremo will join a list of celebrity vignerons that includes Sir Cliff Richard, Mick Hucknall, Bob Dylan, Ernie Els, Retief Goosen, Sting, Gérard Depardieu, Francis Ford Coppola, Carole Bouquet, Sam Neill, Joe Montana and Madonna.
Why do they do it? Ego is obviously a large part of it, but do they think they’ll add to their millions by making wine? Frankly, I doubt it. None of them regard winemaking as a day job, although I suspect that Sir Cliff, Els and possibly Coppola run reasonably profitable operations. Depardieu is something of a figurehead for the Bernard Magrez group, so he must be on a tidy salary, too.
Celebrity wines are a sideshow in many ways. But they are part of a wider phenomenon distorting the world of wine: namely, the desire to put your name on a bottle, irrespective of cost. Celebrities from the worlds of sport, music and acting are no different from the thousands of doctors, lawyers, tycoons, industrialists, bankers and entrepreneurs who have bought into the bucolic dream of owning a vineyard and, more importantly, a monikered wine label.
The interest of people for whom money is no object has inflated the price of vineyard land to ludicrous levels in some places, most notably California. I don’t want to pick on the Golden State, because it applies in other parts of the world, but it is the most obvious example. “Hell, I think I’ll buy me a few hectares of Cabernet estate in St Helena,” is a familiar refrain in the Napa Valley.
Or rather, it used to be. One of the knock-on effects of the economic recession is what a brilliant blog on vinography.com refers to as the “coming carnage in the California wine industry”. Quoting a trade source “Deep Tank”, the blogger predicts “a foreclosure mess just like the housing debacle we just went through”.
When high bottle prices could justify the price of land and setting up a winery, the west coast business model made some sort of sense. Outside California, very few cult wines had a following, despite elevated scores from local critics. But that didn’t really matter. There were enough Americans happy to part with US$100 or more to put a bottle of over-priced Cabernet on the table. But not any more.
How bad is it going to get? Very bad, if you believe vinography.com. “Mix a lifestyle business with a downturn and all you get is a f***ing mess. The sharks are circling and just waiting as the deals get better and better. It’s gonna be a bloodbath and we’re all just waiting for it.” The blogger warns that many small wineries will go to the wall, but so will “mid-tier wineries that are highly leveraged, too”. This, chillingly, applies to 80% of them.
The problems facing the California wine industry are not unique. Half-decent wine is extremely expensive to produce. We all know the best way to make a small fortune out of the wine business is to start with a large one. But the economic downturn has highlighted the shortfall between what it costs to make wine and the price at which it’s sold.
It is highly ironic that at a time when the top Bordeaux chateaux are thinking of charging £5,000 a case or more for their 2009 wines en primeur, countless wineries around the world, including a swathe of lesser names in the Gironde, are contemplating bankruptcy.
The fall out will be greatest in the New World, where a greater number of individuals have borrowed money from banks to finance their dream. But I think it will affect everyone in the end.
In the Old World, properties tend to be more established and less highly leveraged, but once the safety net of EU subsidies is removed, we may see carnage here, too. Alex Ferguson can afford to lose millions setting up a winery, but if I were him I’d think twice before I did so.