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The Achilles Heel of American Wine
By Michael Franz
May 13, 2008
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There is a scandal in the American wine industry, and it isn't what you might guess. It has nothing to do with the use of chemicals or scary additives.  Nor is it about strange manipulative processes like "reverse osmosis" or "spinning cones."  The scandal in American wine is that the United States produces remarkably few excellent wines costing twelve bucks or less.

This assertion isn't based on a mere impression on my part, and I'd ask you to hear me out before either dismissing it or agreeing with it.  And when you've heard me out, I'd be eager to hear whether you share or disagree with my assessment.

The Sorry State of Affairs

Just to flesh out the assertion a bit, I've been doing a lot of focused tasting lately--and for years in the past--on wines from around the world costing $9 to $12 at the retail level.  And strong performers from America are conspicuously rare in this range.  I don't claim to know why that is the case, but I do claim it as a fact.

And it is a surprising fact at that.  Clearly the United States can make excellent wine, and the nation's industry is extremely competitive when we consider wines costing $30 or more.  Value involves a relation of quality to cost, and potential quality is simply not a problem in the USA, as excellent wines are being made not only in California, but also in Washington, Oregon, New York, Virginia and beyond.

So, if America can turn out delicious wines from many quarters, the question is this:  Why isn't the industry turning out strong wines for $10 or $12?  With a more proximate location to markets and hence lower shipping costs, why are American wineries being outperformed by their counterparts in Argentina, Australia, Chile, and in parts of France, Italy and Spain?

The last three countries in this rundown raise a particularly perplexing question:  Given the great strength of the euro relative to the dollar, how can producers in Europe manage to sell wines to American importers--who must buy them with wimpy dollars and then ship them across the Atlantic--and still outperform comparably-priced American wines?

The flip side of this question is a bit less polite:  How can American wineries fail to compete against wines that confront vast shipping distances and grave currency exchange disadvantages?

That American wineries are failing to compete in this crucial price range is clear to me, and I'll indicate exactly why it is clear to me in a moment.  But first, in what respects are American wines coming up short?  The answer requires only four words:  Complexity, structure, distinctiveness and class. 

A distressing number of affordable American wines lack complexity and are chunky and obvious, showing one vaguely sweet fruit note.  And that's all.  No minerality, no hint of earthiness, nothing herbal or leafy.

The simplicity of most affordable American wines extends not only to aroma and flavor, but texture as well.  They are chronically lacking in structure from either tannin or acidity, and this applies to both whites and reds, with whites lacking "cut" and reds lacking "grip."

Distinctiveness is an exceedingly rare characteristic in affordable American wines by comparison to their counterparts from other nations.  Many Chilean Cabernets priced at $10 or $12 taste distinctively Chilean, with signature notes of cedar and dried herbs that you may or may not like, but which clearly convey a sense of place.  Many Argentine Malbecs announce themselves immediately for what they are and where they come from.  Australian renditions of Shiraz may be a little overblown for your taste, but you know right away from whence they came.  Most Tuscan IGT reds are clearly identifiable and unlike anything else made from the same grapes in another country.  Many Tempranillos from central Spain or  Grenaches from southern France ring perfectly true to their regions of origin.  But most California Cabernets or Syrahs costing $12 bucks taste like they come from no place in particular in their soft, sweet, simple emptiness.  They neither offend nor excite.  In case after case, all of the producer's efforts seems to have gone into packaging and marketing, resulting in a fine looking product with no soul.

And sad though it is to say, affordable American wines almost always lack class.  In fairness, most wines in this price category from any country lack class, but there are many more exceptions to that rule coming from countries other than the USA.  Every country makes too many boring wines built on residual sugar and oak chips.  But in America, this profile has reached epidemic proportions at lower price ranges.  By contrast, if you find a $12 wine in a blind tasting that shows real intricacy and stylishness and class, the overwhelming odds are that it doesn't come from the USA.

The Clyde's Competition

Obviously, I wouldn't make such assertions unless I thought I tasted enough wine from enough places to know what I'm talking about.  I taste between 8 and 9 thousand wines each year, considering them for review or judging them "blind" at wine competitions.  And for more than a decade, I've traveled overseas at least six or seven times per year to assess developments elsewhere in the wine world.

But of all the comparative tasting that I do each year, the most illuminating activity regarding more affordable wines arises from an annual consulting project that I conduct with Paul Lukacs, my friend and WRO colleague.  For the past nine years, Paul and I have consulted on the wine program for the Clyde's Restaurant Group, based in Washington, D.C.

Each year, we taste over 1,400 samples to select 31 wines that form the "Core" (as we call it) of the wine lists in the Group's 13 restaurants.  Any distributor or importer is free to submit wines, but no wine can cost more than $15 at the wholesale level.  The vast majority are targeted toward a special segment of the program, and are priced at under $8 wholesale. 

The program's raison d'ĂȘtre is to find the world's best values at affordable price levels.  The restaurants in the Clyde's Group sell lots of wines other than the 31 selected for the "Core Program" (total wine sales topped $10 million during 2007), but the Core Program assures a foundation of low-price, high-value wines that are selected competitively.

The competitive aspect has two phases.  First, Paul and I break those 1,400 wines into peer groups so that we taste all the Chardonnays or Malbecs, for example, against one another.  It takes us about 11 or 12 nights to taste the 1,400 wines in these groups, and  we choose three wines as finalists for each of the 31 slots.  We look very carefully for the best 93 wines, scoring them individually and re-tasting all of the top contenders.

Of those 93 wines that Paul and I selected to show as finalists in 2008, only 10 were made in the USA.

Is this the result of a bias we hold toward foreign wines?  On the contrary.  This project is conducted for an American restaurant selling American food predominantly to Americans.  We are looking for solid American wines to put into the final round of the competition.  I can assure you that I have no anti-American bias, and such a charge could hardly be leveled against Paul, who has written two books on American wine and is an admiring authority.

Breaking down the 93 finalists by category makes the picture look even worse.  Aside from a category with 3 finalist sparkling wines, the other 90 are broken down by "weight" into six main clusters (light, medium, and full-bodied white; light, medium, and full-bodied red).  Of the 10 American wines that were selected as finalists, 7 were full-bodied whites.  Not a single American white made the grade in the light or medium-bodied clusters, and the only reds selected were a Pinot, a Merlot, and a blend.

The 93 finalists were then tasted in a final round by a group of about 40 managers and wine-knowledgeable employees from the restaurant group.  These final round tastings were conducted over the course of two days, with all the wines tasted blind, so that preconceptions and prejudices were taken out of play.  They are also tasted with food, to better simulate the way the wines would perform in the restaurants.

How did American wines fare in the final round?  Of the 19 wines costing $8 or less wholesale, only three were made in the USA, with two made by the same producer.  Everything else was made abroad.  Three winners each came from Australia, Italy and Spain, two each were from Argentina and South Africa, and one wine was selected from Canada, Chile and France.  At slightly higher price points, we selected 12 wines with cost ceilings of $12 or $15.  Of these 12 wines, only three were made in the USA.

I wish that I could tell you that this was just an anomaly from a single year.  However, the 2008 results were actually an improvement over the performance of American wines in 2007, when only 4 of 31 winning wines came from the USA.  And neither 2007 nor 2008 are out of line with the results from earlier years.

Am I Wrong, or Missing Something?

Whether you think I'm right or wrong about the relative weakness of affordable American wines, I'd like to hear your views.  That is true whether you are a consumer or a member of the wine trade.  If you think my assessment is wrong, or my basis for judgment insufficient, let me know why.

If you are an American producer who can set me straight on factors that place you at a competitive disadvantage, I'm all ears.  Perhaps you face production cost or regulatory challenges of which I'm not fully aware.  I'd like to measure those against the discrepancy that I perceive between American potential and performance in affordable wines.

But if you share my frustration at the paucity of strong American wines priced under $12, I'd like to hear from you as well.  Moreover, if you have a hypothesis on why American producers perform so poorly at this price point, I'd love to hear it.  I'll either reprint or summarize reactions in the WRO Wine Blog.

This problem has been bugging me for years, and I'd like to learn how widely my view is shared and whether others have a sense of the causes behind it.  The stakes are actually quite significant.  Few consumers who are new to wine are ready or willing to spend $30 for their first bottles.  And if their experience buying wines for $10 or $12 indicates that American wines are second-rate products, there's good reason to believe that they'll just continue buying from Chile, Australia, and the other countries that are outperforming the United States.

I'm a wine lover and an American, and I want my country's industry to excel rather than fail at this crucial price point.  But at this point, my strong sense is that it is failing.

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Send questions and comments to mfranz@winereviewonline.com