Originally I thought it was brilliant. Reprice Les Forts to mid Super Second levels, and release wines when they were ready, although a few seem to have gone out still needing a few years.
I am sure the other major estates were watching, and I wonder if they think it was worth the effort.
Is this a wine question or investment / financing question?
They could have reinvested the money over the last couple of years and returned 5-6% with very low risk.
Rioja sort of dies this and is part of their USP. If I need a bottle off a retail shelf for immediate consumption Rioja is one of the first places I look.
Not sure what you mean by “working”. For whom?
Well, it’s kept Latour out of my cellar.
Both.
If I break it down, Latour faces some of the same costs as any investor in wine.
I think even Latour does not have the cellar space to house a dozen vintages so will either need to build or rent.
Add the additional cost to insure the wine.
And, as you mentioned, there is opportunity cost, but in this case they will be higher than the 5-6%. I doubt whether any Pinault enterprise is returning less than double figure percentages.
From a wine point of view, I have tasted two or three vintages, and in the case of 1995, we compared the late release with a bottle from my cellar. Slight preference for my bottle, but hardly worth noting.
Sounds like this is a spreadsheet exercise…which is so Bordeaux 
Very few estates, not more than a handful are watching intensely. In order to do this, you need a single shareholder, or shareholders that are not looking forward to yearly dividends, or an owner that does not need the cash flow.
As for how it turned out, the first few vintages after this decision were weak which did not help. This was followed by Covid, a weak economy, high interest rates, and a lack of demand for young Bordeaux. It was bad luck with timing on their part.
Had they done this in the 90s, or early 00s, I imagine it would have worked out well.
The area where it probably helped is with no new vintages in the marketplace for a decade, the amount of back-stock has declined.
It gives Latour more scope for price discovery and avoids them getting tarnished for mispricing as most of Bordeaux somewhat has in 2021 and 2022. They can also adjust to market conditions hence last year when the market was soft, instead of releasing the 2016 vintage, they instead released 2017, so holding back 2016 for better times. I think because of this flexibility and that en primeur is losing a lot of shine as it is no longer a guarantee of getting excellent pricing, longer term it will probably work well. 2019 will likely work very well for them, given it was such an excellent vintage that was released into covid so had to be discounted.
As Jeff says there timing didn’t play so much in there favour, although Latour also do re-releases of older vintages ex-chateau as well and I expect the lack of newer vintages on the market helps them to sell these.
The talk of releasing when ready is clearly marketing nonsense - you could probably just about justify releasing 2013 after 7 years given the weakness of the vintage, but 7 years for 2014 is pushing it and 7 years for 2015 is clearly nonsense.
I would guess the other benefit for Latour is that the discount between trade price and retail price is much lower, i.e Latour make much better margins as they take the risk through holding back and then the wholesales have far less risk selling into a mature market with pricing for those vintages already determined.
FWIW, the allocations I get on Latour are much smaller than all the other first growths.
I think there might be an interesting “compromise” that Latour could do.
Offer a small amount for EP (so much so that it would sell out), then do the late release years later. There doesn’t seem to be a “benchmark” price for Latour anymore (which often gets established to a degree via EP), and I think people speculate what the price should be based on the other firsts, and that math doesn’t work out well for Latour.
Jeff,
Do you think that these things (poorer vintages that they hoped would taste better with time) and a weak economy (with accompanying reduced demand for young Bordeaux) were bad luck on their part of the reason they tried this? I wonder if they were hoping that giving the wines time and waiting for better economic conditions would improve the market (price) for these wines.
The ability to align releases with animal spirits / economic conditions is a huge plus. Will be interesting to see how tactically beneficial that is vs the prevailing ep drip prices. The opportunity cost has been poor, as it has been for anyone holding Bordeaux for the better part of 20 years.
I frankly don’t think Latour was forecasting a bad economy when they released some of these wines later.
Tariffs won’t help
That’s not an issue isolated to Chateau Latour though 
I think the answer depends on perspective
From Latour’s perspective? Probably yes.
They release ex-chateau stock above market price, and it basically instnatly makes the market clear out anything below their release price, despite the fact that some of it has been sat there for a long time without trading.
Is the RoI worth it in contrast to selling en primeur, and investing the money elsewhere? Likely not, but thaats not really the game
FWIW, 2009 Latour is a mind-blowing wine! If I was younger, I’d be all over it. Good for you for scoring a few bottles.
All being well the first bottle is drunk when it is 20 years old - I’ll be 50 and my Dad will be 80 a few days apart so this should be a special way to celebrate.
I had never really thought a bout this. While they can manipulate the release in there favor it works both ways. Last year the 17 vintage didn’t seem to fly off the shelves. Especially because it went up against a highly rated vintage like 23 that was lower in price. If they released when everyone else did they would always be considered the big papa IMO.
What ws the first vintage they did this with ?
