Callaway Golf Restructuring

[Spank818]

I think the signs are there and if they wanted more profitability a simple nip/tuck would have been more apt. Moving production to another town less another country is a major operation plus all the severance they will have to pay out plus all the bad pr they have to endure... you have to be on the road to decline if you're willing to endure all that. I just hope the quality of their product will remain as well as their customer service.

 

[One-T]

Customer support should be fine, but you may need this.....

Spoiler

 

[Badger_Golfer]

Callaway restructuring, will add Mexico facility

Callaway restructuring, will add Mexico facility

http://www.golfdigest.com/golf-tour...restructuring-to-include-mexico-facility.html

Callaway Golf announced today--and on the eve of releasing its second-quarter numbers--that is undertaking a restructuring of its operations over the next 18 months that will include the creation of third-party distribution in Dallas and Toronto as well as the establishment of a new manufacturing facility in Monterrey, Mexico. Manufacturing and distribution capabilities will remain in Carlsbad and Toronto. Additionally, layoffs at each of these facilities will take place over the next year and a half. Callaway currently employs some 2,300 people worldwide and will provide transition support to impacted employees.

The move is the result of the company's desire to improve its manufacturing processes and supply chains. While some manufacturing will remain in Carlsbad, the majority of North American club manufacturing for Callaway will move to Mexico. When the transition is complete, manufacturing for the company will be relatively evenly split between Mexico and Asia.

 

[JB]

Merged with another thread already on the topic.

 

[TC]

Who's to say their struggling? Maybe they aren't profiting as much as they would like? Maybe their profits have stabilized and the only way to make MORE profit is to move overseas. I'm not blaming Calloway for wanting more profit. I"m just not sure the move is because they are "struggling".

whew! thank god dude, i love my profits!

 

[EJR2]

The lowly middle class American factory worker needs a job also.

Unfortunately the reality is that if you are a lowly middle class worker (not sure putting a club head in a shaft 1000 times a day qualifies as middle class work) you need to compete with people willing to do the job for a lot less elsewhere. Here is the rub, say Callaway moves production to Mexico and its next great driver now costs $199 instead of $399 and a new Ping driver made in America has exactly the same performance but goes for $399, which are you buying? We might want to buy the Ping but in the end we buy the Callaway. Same with our cars, how many non pick-up driving people here have an American car?

 

[TC]

Unfortunately the reality is that if you are a lowly middle class worker (not sure putting a club head in a shaft 1000 times a day qualifies as middle class work) you need to compete with people willing to do the job for a lot less elsewhere. Here is the rub, say Callaway moves production to Mexico and its next great driver now costs $199 instead of $399 and a new Ping driver made in America has exactly the same performance but goes for $399, which are you buying? We might want to buy the Ping but in the end we buy the Callaway. Same with our cars, how many non pick-up driving people here have an American car?

i have an american car, two actually.

 

[solidkjames]

Unfortunately the reality is that if you are a lowly middle class worker (not sure putting a club head in a shaft 1000 times a day qualifies as middle class work) you need to compete with people willing to do the job for a lot less elsewhere. Here is the rub, say Callaway moves production to Mexico and its next great driver now costs $199 instead of $399 and a new Ping driver made in America has exactly the same performance but goes for $399, which are you buying? We might want to buy the Ping but in the end we buy the Callaway. Same with our cars, how many non pick-up driving people here have an American car?

That's just it. They won't lower the cost of their clubs. They will spend that money on the CEO, big wigs, stockholders and giving Phil Mickelson/pro's more money. Capitalism is great in theory but America is living proof that it doesn't work for the middle class. Capitalism has always produced more than employees and others can afford to buy, thus leading to repeated cycles of overproduction, layoffs, unemployment and recession or depression. People create things that they can't even afford themselves and I'm pretty sure companies would just use slaves if the slaves could get money to buy from the corporations. And that's why this country's citizens have close to 50 trillion dollars in debt.

So that is where imperialism comes in when they take their capitalism to other countries because there is no other way to increase profits. I just start getting pissed at how much corporate America has our country, zombies (people who work for them) and our government by the balls. Capitalism has pretty much evolved into a government run corporate elite party and all of the working class people are being left out. To hell with Callaway or any other company that does anything to help fuel that. That's my 2 cents.

 

[TC]

name one major golf equipment OEM that doesn't outsource? might as well just quit playing golf, and wearing clothes, and eating food, and playing on your computer, and driving your car.......that's how most big businesses work, as crappy as that may be.

 

[JB]

That's just it. They won't lower the cost of their clubs. They will spend that money on the CEO, big wigs, stockholders and giving Phil Mickelson/pro's more money.

That is really not the case at all with them. Phil makes the same and is in a contract. CEO's salary for Callaway is dependent on financials. And they DID just lower the cost of their irons. X-24s new were cheaper than previous line.

 

[EJR2]

I think we have all seen new equipment priced a little lower this year than last year. When is the last time we saw top of the line new drivers come out at $299 or have gifts like free video cameras or $100 "burner bucks". It is most likely the result of the poor economy and the need to move product. The shift to less expensive production may in fact result in lower prices are at least prices not going up like we had seen in the early 2000s.

 

[solidkjames]

No one on earth knows what causes inflation but I'm pretty sure the person who figures it out will be paid to shut up. Ive always said profits drive inflation and that's something me and my Econ professors used to fight tooth and nail over. Products haven't increased as much since 2000 due to 9/11 and its aftermath it has had on everything but in 1995 I could fill my car up with gas for less than 20 bucks and a set of irons cost 400 bucks. It's just a matter of time when we are paying 1500 for a set of x - 40's and the rich will be just as rich as they are now.

 

[EJR2]

That's just it. They won't lower the cost of their clubs. They will spend that money on the CEO, big wigs, stockholders and giving Phil Mickelson/pro's more money. Capitalism is great in theory but America is living proof that it doesn't work for the middle class. Capitalism has always produced more than employees and others can afford to buy, thus leading to repeated cycles of overproduction, layoffs, unemployment and recession or depression. People create things that they can't even afford themselves and I'm pretty sure companies would just use slaves if the slaves could get money to buy from the corporations. And that's why this country's citizens have close to 50 trillion dollars in debt.

So that is where imperialism comes in when they take their capitalism to other countries because there is no other way to increase profits. I just start getting pissed at how much corporate America has our country, zombies (people who work for them) and our government by the balls. Capitalism has pretty much evolved into a government run corporate elite party and all of the working class people are being left out. To hell with Callaway or any other company that does anything to help fuel that. That's my 2 cents.

I think you show a good example of the "buy american" campaign not living up to the hype. A majority of your clubs are made by Germans and your balls are made by the Japanese. The only American things in your bag are the putter and wedge. Not picking on you, but everyone saying that they support American workers and then go out and buy Bridgestone balls are actually buying the product that gives them the best results regardless of where it is made. Titleist balls are made right down the street from my house. I am sure the local American workers here would greatly appreciate you switching to the Pro-V1.

 

[JB]

That is really not the case at all with them. Phil makes the same and is in a contract. CEO's salary for Callaway is dependent on financials. And they DID just lower the cost of their irons. X-24s new were cheaper than previous line.

No one on earth knows what causes inflation but I'm pretty sure the person who figures it out will be paid to shut up. Ive always said profits drive inflation and that's something me and my Econ professors used to fight tooth and nail over. Products haven't increased as much since 2000 due to 9/11 and its aftermath it has had on everything but in 1995 I could fill my car up with gas for less than 20 bucks and a set of irons cost 400 bucks. It's just a matter of time when we are paying 1500 for a set of x - 40's and the rich will be just as rich as they are now.

Im curious though. You gave some examples that were incorrect and they have changed much of that. Are you sure this is not just your political thoughts in general rather than a feeling towards a particular situation?

 

[solidkjames]

I think you show a good example of the "buy american" campaign not living up to the hype. A majority of your clubs are made by Germans and your balls are made by the Japanese. The only American things in your bag are the putter and wedge. Not picking on you, but everyone saying that they support American workers and then go out and buy Bridgestone balls are actually buying the product that gives them the best results regardless of where it is made. Titleist balls are made right down the street from my house. I am sure the local American workers here would greatly appreciate you switching to the Pro-V1.

If I bought American I would be playing with a set of rebar wires and putting a golf ball made in 1930. There is nothing made in America anymore. We sell our steel to the Chinese and buy the **** right back. Why? So someone can get rich.

 

[solidkjames]

Im curious though. You gave some examples that were incorrect and they have changed much of that. Are you sure this is not just your political thoughts in general rather than a feeling towards a particular situation?

I think my feelings toward the situation are driven by the fact another American company is laying off american workers to make more money. And it pisses me off.

 

[EJR2]

If I bought American I would be playing with a set of rebar wires and putting a golf ball made in 1930. There is nothing made in America anymore. We sell our steel to the Chinese and buy the **** right back. Why? So someone can get rich.

You can still buy from an American company that pays US taxes and employees US people. I always bought FootJoy shoes because they were made in Brockton, MA and Titleist golf balls because they were made in Achusnet, MA. Now FootJoys are made in China so I got to switch to Nikes which fit me better anyway. And while I know my shoes were made in China or Taiwan or somewhere like that, at least the corporate profit goes to a US firm.

 

[JB]

I think my feelings toward the situation are driven by the fact another American company is laying off american workers to make more money. And it pisses me off.

No, that is not really the case. This American company does not make their clubs here. They are going to move jobs. They have no alternative. They are hemorrhaging money. You said it was to give the CEO more, Phil more, and they will not lower the price of clubs. yet they JUST DID THAT!

 

[Miss Shanksalot]

I'm not going to get into the whole "capitalism sucks" argument, because it doesn't seem germane to this thread.

However, I will say that a company's primary responsibility is to its shareholders and other investors: Unless you're talking about nonprofits, they're supposed to make a buck and try to prevent losses....

It seems to me that that is exactly what Callaway is doing here.

 

[Hawk]

I smell a hot topic in the debate room!

 

[solidkjames]

I respect your opinions I really do but truth is making profits doesn't have to be at the expense of working American's. Callaway can cut down on the 352343141 commercials they put on tv each week and probably save a few hundred jobs alone. That is my point. We know winners play Callaway but they don't run the company.

 

[JB]

I respect your opinions I really do but truth is making profits doesn't have to be at the expense of working American's. Callaway can cut down on the 352343141 commercials they put on tv each week and probably save a few hundred jobs alone. That is my point. We know winners play Callaway but they don't run the company.

If that is what you believe than so be it. But if you think they did not exhaust those efforts, I have to strongly disagree with you. The goal for a public company is to the shareholders. They have been losing money. AT A HUGE PACE! You asked that they drop the price of irons and they did that.

 

[TOAOST21]

does anyone here think that this "restructuring", and lets be honest it's outsourcing, will affect how some of their tour players look at it i mean i don't see Phil saying well I'm gone, but some of the other guys might take a look at this and not want to be grouped with it

 

[JB]

does anyone here think that this "restructuring", and lets be honest it's outsourcing, will affect how some of their tour players look at it i mean i don't see Phil saying well I'm gone, but some of the other guys might take a look at this and not want to be grouped with it

If they did, they would have to abandon every company out there. The real question will be if they completely move factories, will the trust they had with a factory and equipment house, have learning curves that they have to get over and will the gear suffer because of it.

 

[derelict]

When people cry about labor based jobs moving over seas it always makes me laugh. Sure it is sad for those who were laid off. But in the long run, if it makes the company more profitable, it is better for the company and better for the consumers. With more profit, they can invest more in R&D and in new product development. People focus on the loss of jobs short term, but what use is it for a company to keep the labor here, and eventually go out of business because they can't turn a profit. They can always tell their shareholders "Sure, you lost your entire investment, but it was for the good of the American economy!"