Keeping Company in Carlsbad

Many players doing battle at the Open will be armed by companies just up the road

Carlsbad became the capital of the industry aided by a ready workforce.

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By E. Michael Johnson

Photo By J.D. Cuban

June 6, 2008

In 1999 Rocco Mediate was hitting prototypes of Callaway's first golf ball, the Rule 35. When Mediate hit three in the water on the ninth hole at Del Mar CC, Chuck Yash, then head of Callaway's ball division, took off his shoes and socks, waded in the water and tried to recover the balls—not the kind of duty you would expect the boss to undertake. But when your main competitor's office is less than a mile from yours, you leave nothing to chance.

Welcome to life in Carlsbad, Calif., golf equipment capital of the United States and, quite possibly, the world. To a cartographer, Carlsbad is a dot on the map 20 miles north of Torrey Pines; an exit on Interstate 5 that leads to beaches, flower fields and Legoland. But don't let the balmy climes and laid-back locals fool you: The epicenter of the golf industry is one of the most competitive places on earth.

Today more than 15 golf companies reside within a 50-mile stretch, including Acushnet, Callaway and TaylorMade. The close confines are anything but friendly and some of the stories serve as an example of what happens when golf's superpowers live virtually next door to one another.

Such as the time Callaway claimed a competitor used a helicopter to spy on the ball plant it was constructing. Or the "Free Mark King" banner that hung from TaylorMade's headquarters when the exec was the subject of a legal dispute between the company he had left (Callaway) and the one he was re-joining (TaylorMade). Or the time Dick Rugge, now USGA senior technical director, but then a TaylorMade engineer, took his wife to dinner and spent the evening watching her listen intently to the conversation going on in the next booth—a table occupied by Ely Callaway.

"You literally had to watch what you said in the checkout line at the grocery store," says Steve McCracken, senior executive VP and chief administrative officer for Callaway Golf, who has worked for the company since 1990.

It wasn't always so. In the '80s, shortly after Cobra came to town and quickly was joined by the Big Three, things were more congenial. It stayed that way for several years as numerous smaller firms such as Founders Club, Goldwin, Hippo, La Jolla, Langert, McHenry Metals, Odyssey, Plop, Ray Cook and many component companies set up shop nearby before consolidation, rising costs and an industry recession in the late 1990s weeded many out.

"We actually helped each other," says John Worster, executive VP, golf club operations for the Acushnet Company. "If we ran out of Dynamic Gold S300 shafts, I called people at other companies and borrowed shafts until mine came in."

Perhaps part of the reason for the civility was that Carlsbad was an ideal place to work. There was relatively little traffic, an ample labor supply, plenty of affordable acreage on which to build office space and, importantly, a close proximity to suppliers, most notably Coastcast, which at the time was the leading casting house for club heads.

Weather, too, played a key role, as the Southern California climate provided the dual benefit of being able to test products year-round while allowing companies to dangle the prospect of working in this idyllic setting next to the Pacific Ocean to potential employees. Smart people were as abundant as the good weather, too. When the aerospace industry took a downturn, it left people looking for work.

The benificiary of the arms race waged in the R&D backrooms by those engineers was the consumer. An industry that used to settle for simply making a product better than the last one now searched for perfection, perhaps fueled by Ely Callaway's "demonstrably superior and pleasingly different" mantra. With that came more choices at competitive prices.

"It's interesting this community exists, and it's been good for our customers," says King, president of TaylorMade. "The only negative is it's not as friendly as it was. I've looked at joining a different country club, and I'm thinking 'I can't go there because the Callaway guys are there and I can't go there because the Titleist guys are there.' "

Not unless he's prepared to go diving for prototypes.