Union: New Era to close Derby plant

New Era Cap plans on closing its manufacturing plant located in Derby in March, according to the union representing workers there.

A spokesperson from CWA Local 14177 tells 7 Eyewitness News the closing will put more than 200 people out of work.

Top brass at New Era tells me the company is dealing with an imposition of a 10% tariff, which it has been able to absorb across global ops. Says Derby’s closure is not a direct result of the tariffs - owning & operating a manufacturing plant is out of line w/ global competitors. https://t.co/DXHpX829hS

— Ashley Rowe (@AshleyroweWKBW) November 13, 2018

New Era says in a statement it is "considering the discontinuation of operations."

"This is extremely difficult for me," said New Era CEO Chris Koch. "I grew up in Derby and worked in the facility, which has a long, productive history with the company. Even as other sports apparel brands moved away from running their own manufacturing plants, we continued making caps at our facility in Derby. But I have an obligation to our employees, partners and customers to ensure the long-term success of this company and we need to keep pace with changes in our industry."

I’m also told New York’s corporate tax policies weren’t a factor in the company’s decision. This is about staying competitive - running a one-product production line is too costly. More efficient ways of doing it in tough business climate. https://t.co/w9YcygzA43

— Ashley Rowe (@AshleyroweWKBW) November 13, 2018

The Derby plant is New Era’s only headwear manufacturing facility in the United States.

The Buffalo News reports the company is moving its manufacturing facility to Miami.

New Era Cap says this will not affect operations at headquarters on Delaware Avenue in Downtown Buffalo, where more than 300 people work.

Manufacturing Strategy Expert, Nallan, Suresh, of University at Buffalo's School of Management says manufacturers closing their doors in this climate isn't uncommon, it's a result of an industry currently facing uncertainty and disruption. 

“The manufacturing scene is very much alive and well here in Western New York and I don’t think it’s as bad as it sounds," Suresh says. “[The unemployed workers] may have to look for jobs in other sectors but manufacturing sectors and I do believe that there’s plenty of opportunities right here.” 

Suresh said that he expects the industry to stabilize within the next three to four years.

This is a developing story. Check back for updates.

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