Global Wine Wars

2224 words 9 pages
1. Briefly describe the changing economic geography of the global wine industry in terms of production, distribution and consumption.

The Global wine industry has undergone a monumental change in terms consumer demand and more importantly in the ways it is produced and sold. The consumption, distribution and production has migrated away from the restrictions and regulations of the Old World to the New World ways of smart marketing, branding and serving to customers preferences.

Middle ages emerged as the time when Europe served as the niche market for premium wine. But by and larger grape growing and wine making gradually became a fragmented business. Up to mid 20th century, wine was predominantly produced in European countries
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4. What changes in the global industry structure and competitive dynamics led the U.S. and Australian producers to gain market share to challengers from France and other “Old World” countries in the late 20th Century? What trade or other theories best explain this process?
Cheap Resources
The new world had the advantage of vast, abundant and inexpensive land available which spurred the growth of extensive vine yards. While the vine yards in France and Italy were becoming fragmented, they grew exponentially in the U.S, Australia and other South American countries like Argentina and Chile. They began to use machinery and equipment to deal with labor costs in these large vine yards.
Innovation and Technology
Technology and innovation in the new world countries broke away from the old wine making traditions. Innovations like control drip irrigation, night time harvesting; trellis systems maximized grape growth and in turn wine production. They also experimented with different fertilizers, and used reverse osmosis to make a better tasting wine. Several innovations were forbidden under AOC regulations deeming that they would compromise the quality of the wines. Traditionalists described many of these innovations as sacrilege and that new-world producers had lost the character that came with more

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