All indicators suggest that the northern California wine country will see a difficult year in 2009. But it is likely that the Napa Valley wineries, which command the highest prices for its product of any appellation in the United States, will accordingly be hit the hardest by the lean times. But it’s not merely the cost of the grapes that may contribute to the region’s difficulties this year. Napa Valley has also historically been known for its higher-priced hotels and restaurants, higher tasting room charges, and the average price per bottle of its wines across varietals is significantly above others.
All one has to do to see the writing on the walls of the wineries is to take a wine country tour for oneself and witness the dearth of people in the tasting rooms and restaurants. It is likely a portent of what’s to come. Napa Valley insiders have never seen the sort of drop off in visitor traffic and the visitors’ bureau is forecasting both business and tourism international traffic into San Francisco to continue to fall over 2009.
There are also plenty of articles being written that highlight the trend in wine, which is not only less volume, but the average cost of a bottle of wine being purchased has fallen as well. Most wine being purchased now falls into the ten to twenty dollar range, and yet most of Napa Valley’s offerings reside outside of this window. Restaurants have already made adjustments to their menus to accommodate consumers and while they would likely replace those offerings with others from the same Napa Valley winery if they could, that is rarely possible as many of those vineyards don’t have offerings at the lower price points. If the tasting room charges also remain high, consumers will redirect their wine country tours and head to Sonoma Valley where they can not only enjoy a similar experience for fewer dollars, but also purchase wine that they can afford to drink.
