The Scourge of Napa Valley

California winemaker Fred Franzia says the world would be better off without all that expensive Napa Valley wine. And that's not just an opinion--it's a business plan.

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Tell him to get f---ed."
Fred T. Franzia is dictating a message for his advertising consultant. Franzia, the chairman and CEO of Bronco Wine, is sitting in his office in the San Joaquin Valley of California. His family business is one of the largest wine companies in the United States, yet his headquarters is about as luxurious as a trailer at a construction site. It's a small, termite-ridden building beside a fence topped with barbed wire. Behind him are shelves lined with dozens of his wines, many costing less per bottle than a six-pack of beer. The bottles clink when the air conditioning kicks on. Trucks rumble through the gate by the guard shack outside the window. A gun safe gathers dust in the corner. He can't keep weapons anymore because he's a convicted felon.

Franzia, 62, is a jowly winemaker with a barrel torso and little patience for critics. After six years, he has just come out on the losing end of a high-profile legal battle against vintners in Napa Valley over whether he can put Napa labels on bottles of wine made with cheaper grapes grown elsewhere. Franzia dismisses the Napa vintners as "a bunch of whiners." He believes that the wine industry has become intoxicated by elitism, inflated prices, and its own PR about terroir--the idea that a wine is uniquely a product of the place it comes from, and by extension that some places are better than others. "Why complicate it?" asks Franzia, voice rising. "Does anybody complicate Cheerios by saying the wheat has to be grown on the side of a mountain and the terroir in North Dakota is better than Kansas and all this horse s---? You put something in your mouth and enjoy it. If you spend $100 to buy a bottle of wine, how the hell are you going to enjoy it? It's a joke. There's no wine worth that kind of money."

It's not just Napatistas who rile him into bursts of profanity. There are the retailers with their excessive markups ("greedy bastards"), restaurants with their overpriced wine lists ("they rape the consumer"), and his paragons of oenophile elitism: the famous wine critic Robert Parker and Wine Spectator magazine ("their expertise is talking about themselves and saying they're the experts"). And don't get him started on corkage fees. Still, the Napa vintners do occupy a special place in his spleen. "This is what pisses off your friends in Napa," he says, and shows his latest salvo: a newspaper advertisement that reads, "Think you have to spend $20 for a Napa Valley Merlot? Think again!"

Soon his secretary appears at his side and slips him a note. It's a memo from his advertising guy, recommending that Franzia not share the ads before they're ready for publication. Franzia abruptly hands it back to his assistant and renders his executive decision: "Tell him to get f---ed."

He chuckles and shakes his head. "Like he's going to tell me what I'm going to share with people?"

Not surprisingly, many Napa vintners view Franzia as the barbarian at the gate. Last summer, at the annual dinner of Napa grape growers, the assembled chanted "Kick Bronco's butt! Kick Bronco's butt!" Throughout his career Franzia has defied conventional wisdom, industry trends, and occasionally the law. In 1994 he pled guilty to federal charges of conspiracy to defraud and paid a half-million-dollar fine. In 2000 he inspired a change in state law regarding the labeling of wines. Then came the six-year fight over that law. "Mr. Franzia is what I would call an unscrupulous renegade who not only loves to find an edge but is pretty ruthless in doing so," says Vic Motto, a Napa Valley consultant. "He not only likes to make a buck, but it's even better for him if he can make it at your expense. It just adds another element of pleasure for him."

Franzia is the most controversial figure in the U.S. wine industry and also one of the most savvy. By moving in exactly the opposite direction of the industry elite, he has built Bronco into the fourth largest wine company in the United States in case sales: Last year Bronco sold 20 million cases, or 240 million bottles, of wine, $400 million worth. His masterstroke is the cheapest of his dozens of wines--the famous Two Buck Chuck, the fastest-growing label in the history of the industry.

"He's the kind of person--there's one in every industry--who loves to go against the grain and make money at it," says Robert H. Smiley, director of Wine Programs at the Graduate School of Management at the University of California, Davis. "He's a very good businessman, there's no doubt. The legal issues I'll leave aside."

Franzia's mission is to make wine so affordable and plentiful that every American can put a decent bottle on the dinner table. He drives down prices by running an efficient operation that takes advantage of economies of scale--Bronco owns nearly three quarters as much vineyard acreage as all of Napa Valley combined--and by swallowing up competitors that fall on hard times. Now, as U.S. wine consumption reaches new high after new high and the domestic wine industry hits the $27 billion mark, Bronco is flexing more muscle than ever. And that is making Franzia the bête noire of some parts of wine country.

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