Graphite Design makes a bad move closing its doors

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Strategies don’t often change in the middle of a hot streak.

That’s why it came as a shock to the golf industry that Graphite Design International, the company that manufactures Tiger Woods’ driver shaft, has decided to vacate North America, closing its U.S. headquarters in San Diego and laying off all of its employees effective Nov. 30.

Margins for shaft makers have been shrinking in recent years, as OEMs have insisted on lower prices from component makers. But the timing of GDI’s decision is strange, given the success the company has enjoyed in recent years.

The company was founded in Japan in 1989, where it has dominated marketshare for more than a decade. But since Woods first began using the company’s Tour AD DI 6X shaft in his driver in 2010, the GDI products have seen a spike in usage on the PGA Tour.

Webb Simpson, Matt Kuchar, Jonas Blixt, Mark Wilson and Johnson Wagner all trusted at least one GDI shaft in route to victory on the PGA Tour in 2012. And Adam Scott, who is No. 6 in the Official Golf World Rankings, plays the company’s shafts in his driver and hybrid.

According to sources who spoke on the condition of anonomity, GDI decided to consolidate operations to its world headquarters of Chichibu, Japan for tax purposes. They said that the company will also remove its shaft representatives from the PGA Tour in 2013 and is in the process of ending its current contracts in North America.

PGA Tour players depend on reps for product information and custom shaft services. How can GDI expect to maintain its presence on the PGA Tour and its affiliated tours in North America without representation? Does the company expect OEM tour reps to provide these services for them?

Chances are they won’t. In the ultra-competitive golf shaft industry, OEMs will work with companies that provide great products and great service. Who is Nike supposed to call for support when Tiger wants a new shaft for an updated driver model … Japan?

GDI will find out what a bad decision this was in the years to come. Graphite Design’s recent success can be directly attributed to the usage of its products by Woods and other top golfers. The company’s decision to leave North America jeopardizes PGA Tour usage of GDI products, and also adds communication hurdles between the GDI and major OEMs.

If Graphite Design sticks to their current strategy, “Graphite who?” will become the sentiment in the Americas.

Click here for more discussion in the forums.

This story was a combined effort of the GolfWRX Staff

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15 Comments

1. 

   jr

   November 2, 2012 at 1:47 pm

   How can you say it’s a bad decision? Have you seen their books? Do you know what their making? Losing? Have you run a worldwide shaft manufacturing company? These companies don’t make decisions by the seat of their pants.

   Reply
   • 

     sdgfhjkhgjkdfsfg

     November 2, 2012 at 6:20 pm

     This article went from informative to an op-ed quicker than a Cameron scam.

     Reply
2. 

   John Muir

   November 2, 2012 at 2:19 pm

   Graphite Design shafts will still be available, they’ve granted exclusive aftermarket distributorship to a group led by their current CFO and their current vp of sales.
   John Muir
   clubmaker online

   Reply
3. 

   Paul Carlson

   November 2, 2012 at 2:53 pm

   This post seems a bit hasty to me. I would have appreciated a more thoughtful analysis of their US decision. If the shafts are in demand, the reps will find a way to get them. I agree with JR & John on this one.

   There must be a reason they’ve done this. Could it be they’d rather focus on eastern markets? China? Korea?

   Just my .02

   Reply
4. 

   EJ

   November 2, 2012 at 5:23 pm

   WHO CARES, ROBOTI SAYS STEEL IS BETTER ANYWAY! LOL

   Reply
5. 

   Nuke LaLoosh

   November 2, 2012 at 6:14 pm

   It is a result of California tax policy. Why stay in a high tax state/country when you can manufacture elsewhere and import. Simple economics!

   Reply
6. 

   timmy

   November 2, 2012 at 6:15 pm

   I think its a good business decision

   Also not having a sales rep on site is not going to be a big deal

   Players will have access to the shaft no matter what and if they want to know more about the specifics they can simply send them an email or contact the rep in japan via social media.

   Will this decision diminish the presence of GDI shafts on the tour? Definitely not. Professional sports is all about performance and GDI has proven its quality and performance in such a powerful way people and players will continue to look for their product.

   Reply
   • 

     Richard

     November 4, 2012 at 8:43 am

     I disagree. Just my opinion but I see the future in this one. Only memories of GD shafts in a few years. Little on tour since no reps to peddle them and very little if any on OEM shafts since there will be no presence in North America.

     Reply
7. 

   Jay

   November 2, 2012 at 9:27 pm

   This might be one of the daftest golf related opeds i’ve ever read. Thanks for the entertainment zak.

   Reply
8. 

   Adam

   November 2, 2012 at 10:36 pm

   Smart move. Get out of Cali and away from the massive taxes. No smart company will stay in America. We are taxing ourselves to death. Hate to go overseas. But you have to do what you have to do to survive.

   Reply
9. 

   ACGOLFWRX

   November 3, 2012 at 7:30 am

   They have made the right decision! The company will do better outside the U.S.A anyway….

   Reply
10. 

    Cameron

    November 3, 2012 at 1:47 pm

    People are misinformed if they think GDI is leaving because of California tax policy. If GDI is leaving because of tax issues it is due to federal taxes not state taxes.

    Reply
11. 

    Carl

    November 4, 2012 at 5:36 am

    HOW WILL ANYONE GET IOMIC GRIPS IF THEY ARE ALL THE WAY IN JAPAN??? WHAT DO YOU THINK THERE IS SOME TYPE OF MAGICAL MACHINE THAT CAN FLY THEM THRU THE SKY AND INTO THE COUNTRY FOR DOMESTIC USE?!?!?! Oh wait….

    Look, The bottom line is that OEMs will do whatever it takes to get the shafts that tour players want to play, in the players hands and ready to play (and hopefully win).

    —”What are they going to do call JaPaN?”

    Yes. That is exactly what they are going to do. And I am positive that GDI will get the OEMs a truckload of their shafts, ready for play, within a reasonable timeframe (3-5 days).

    Graphite Design shafts are already manufactured in Japan. The only thing that is going to change for the NA consumer is where their shafts are being directly shipped from.

    The day that Graphite Design becomes “Graphite Who?” in the Americas, is the day that this site dies.

    Reply
12. 

    Mark Burke

    November 5, 2012 at 5:24 pm

    The Graphite Design Shafts are so expensive. Last time I broke my driver shaft when I threw a temper tantrum on the course during a tournament on my way to another 86. I reshafted with a stick I found by the homeless shelter. My buddy New York gave me some tape and bam new driver shaft.

    This has been a tip from Mark Burke Golf Bum

    PS I am Still trying to clear my name

    Reply
13. 

    Ken Boucher

    December 29, 2012 at 2:29 pm

    I am a GD dealer, I have been informed of all the changes and it looks like it will be a better deal for customers. Cost of a shaft will decrease if anything and I will easily be able to get shafts be it for woods hybreds or irons. As a Miura dealer I can attest to the quaility these tour ad iron shafts are especially matched with Miura irons. Best of the best, so yes they are still going to be available and this was nothing more than a simple business decision

    Reply