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RICH LEGACY
Michael Bamberger
February 05, 1996
Karsten Solheim has handed his once omnipotent Ping dynasty over to his sons
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February 05, 1996

Rich Legacy

Karsten Solheim has handed his once omnipotent Ping dynasty over to his sons

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For years he was way ahead of the curve, but the years and the curve finally caught up with him. Karsten Solheim—his name is as famous as his little white beard—is 84 years old now. His Ping irons were once considered radical, but now everybody is copying his perimeter-weighted, cavity-back design. His family-owned company, Karsten Manufacturing Corporation of Phoenix, is still a dominant player in the golf business. And Solheim, according to Forbes, remains one of the 400 richest people in the country.

But business is not as it was. Last year, for the first time since 1983, Ping, according to an independent and highly regarded survey, was not the game's top-selling iron. It was second, to Cobra. Something had to give. In June, Solheim relinquished control of his company, but only after one of his three sons asked for the reins.

To Ping's boosters, the No. 2 ranking is temporary and a statistical blip, but the underlying fact is that Ping's 1995 sales ranking would have been lower were it not for the continued success, 14 years after its introduction, of the Eye2 iron.

Merchandisers still speak reverentially about the sales of the Eye2. During the golf boom of the middle and late 1980s, the Eye2 was the club of choice, and it is regarded as the best-selling iron in the long history of iron-selling. But the competition has caught up. A club professional who made college-tuition payments on his Ping commissions during the Reagan years said recently, "Ping is a nice club. Cobra makes a nice club. The Armour club is good. Wilson, Callaway, Titleist—they're all making good clubs now."

In hotel bars at golf trade shows, industry watchers seem to enjoy speculating on Karsten Manufacturing's problems, or, more accurately, perceived problems. (The tone of pettiness is rooted in the fact that the company has never been part of golf's old-boy network. Solheim doesn't drink or hang out, and his roots are in engineering, not golf. He's viewed as an outsider and a renegade, and so is his company.) Industry insiders cited Karsten Manufacturing's disputes with the PGA Tour, the USGA and the Royal & Ancient over what constitutes a conforming club and how the feuds and consequent lawsuits distracted Solheim from club design. They listed the marquee players Karsten no longer has under contract, including Mark Calcavecchia, John Daly and Bob Tway, each of whom won a major championship playing Pings. They chided the company's guileless, homemade advertising campaigns. They questioned Solheim for his apparent reluctance to turn over day-to-day control of the company to the next generation.

Last year, for the first time since 1968, Karsten Manufacturing had layoffs. One hundred nine employees were fired, reducing the working population at Karsten to 1,700. "Our orders had fallen some," says Allan D. Solheim, a Karsten Manufacturing personnel executive and the second of Karsten and Louise Solheim's three sons.

The widely held belief was that one day either Allan or his older brother, Karsten Louis, or their younger brother, John, would be named as president of the business, but nobody knew which brother it would be or when the transition would come. (The Solheims' married daughter, Sandra Aiken, was not interested in the position.) The subject of succession was not discussed openly, not at board meetings, not at family dinners. The brothers were candidates for a job for which there was no apparent application process and no known timetable. Families have been rendered dysfunctional with far less at stake, but the three brothers knew the viability of the company depended on orderly change. Without saying a word, they pledged cohesion. They wanted Karsten Manufacturing to remain a family company.

In considering his three sons, Solheim did not lack for variety.

Allan, 55, is a marathon runner, a sporadic but intense golfer, a horseman and a statesman, of a kind. A friendly and warm man, he merrily hands out business cards that identify him as a consul of Norway, an honorary governmental position he relishes (Karsten Solheim was born in Norway), and he likes to wear brightly colored sweaters, many of which he buys on his frequent trips there.

Louis, 58, is a very occasional golfer and a devout Christian who lives, despite his family's immense wealth, in the heart of suburban, middle-class Phoenix. He was trained as an engineer, as was his father, and, in his somber-colored cardigans and glasses, exudes a professorial manner. Like his father, he sees any topic's potential for complexity. Describing his father's business philosophy, for example, Louis says, "He would never say his goal was to build the best golf club, or make the most money, because the goal was never any one thing. Once you thought you had the goal trapped in a corner, it moved. The goal was undefinable and ever-changing."

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