Driven

Callaway Golf Company (NYSE: ELY) in December will unveil its new ERC Fusion driver to the public, but don't expect that to be the only new Callaway driver on the market in 2004. Company Chairman Ron Drapeau told Wall Street analysts on Oct. 23 that Callaway will to introduce a new Big Bertha line of metal woods in '04 that will feature cast titanium drivers and stainless steel fairway woods.

Drapeau did not get specific on the price points for the new line, but said the prices "will surprise you," likely meaning the prices will be in the medium price range to aggressively go after rivals TaylorMade-adidas Golf and Cobra, each of whom are selling cast titanium drivers in the $300 neighborhood, and each of whom have taken away market share from Callaway the past two years.

"I believe (the new Big Bertha line) will help us reverse the downward trend we've experienced in a very profitable segment of our business," Drapeau said.

Callaway Golf's metal woods sales for the first nine months of this year fell 17 percent compared to the same period a year ago to $213.9 million. Despite that decline, Callaway Golf remains the market share leader in metal woods, according to Golf Datatech, which tracks sell-through sales figures at on course shops and off course stores.

But that's not good enough for Drapeau.

"We intend to recapture share next year as part of a multi-year plan to move us to historical levels," Drapeau said. "Moreover, I think these new products are exciting enough that they can bring some consumers, who have been sitting on the sidelines during these bad economic times, back into the market place, growing the size of the pie."

That said, Drapeau warned there is no such thing as a sure thing.

"I can't assure you we will recapture all of our lost woods business in 2004. I think it will be a gradual process," Drapeau told the analysts. "We need to not only recapture lost market share but we need to grow the market back to historical levels. We're committed to the goal of restoring our woods business to historic levels by 2006."