New Era Cap eyes closure of Derby plant
DERBY — New Era Cap Company may close its plant in the town of Evans.
The company issued a statement Tuesday, saying it had notified the Communications Workers of America (CWA) that it is considering the discontinuation of operations at its Derby, NY facility, effective March 2019. “This contemplated decision is part of the Company’s ongoing effort to more closely align its business model with its competitors in the global sports, lifestyle and apparel industry by moving away from owning and operating manufacturing plants,” the statement read.
“This is extremely difficult for me. I grew up in Derby and worked in the facility, which has had a long, productive history with the Company,” said Chris Koch, CEO of New Era. “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.”
New Era said it would continue U.S. production of the caps that Major League Baseball players wear on the field of play. Going forward, this would be done at New Era’s existing facility in Florida, where the company has production for its 5th & Ocean label. Otherwise, the production currently done in Derby would be absorbed by their existing global supply network.
Even though the Derby site may close, New Era said in its statement it remains committed to Western New York. In 2006, the company moved its headquarters to Buffalo and was one of the first anchor tenants of the revitalization of downtown Buffalo. “Over the last decade, New Era has had impressive job growth at its Delaware Avenue headquarters, where 337 people currently work. The Company’s headquarters is not affected by the contemplated decision, and the Company expects to further grow its HQ footprint as it moves more aggressively into areas like e-commerce and social marketing,” the company stated in a a news release.
“In accordance with the collective bargaining agreement with CWA Local 14177, the company has informed the union of its contemplated decision and expects to meet with the union to discuss the matter in the coming weeks. New Era is prepared to offer the affected employees benefits and severance at levels beyond what is required in the current agreement,” the company concluded.
State Sen. Cathy Young noted the irony of New Era closing the same day that the state was giving a major tax incentive to Amazon.
“Today we received the devastating news that Erie County manufacturer New Era Cap will close its Derby plant in March, putting over 200 workers out on the street. Contrast this with today’s news from the other side of the state, that Long Island City in Queens will become the site of one of Amazon’s highly publicized ‘HQ2’ operations.
“Touted as a win by the Governor and New York City officials, it comes at a high price: a staggering $1.525 billion dollars, the largest financial incentive in state history, and all for a global corporate giant valued at nearly $1 trillion,” she said.
Young noted that overburdened New York taxpayers, particularly those in upstate who are seeing their communities and families decimated by job losses and lack of opportunity, have every right to be outraged by this massive giveaway.
“In Western New York, the unemployment rate in many counties hovers around 4.2 percent, far higher than the statewide rate of 3.8 percent. Our hardworking dairy farmers are seeing their farms and futures disappear before their eyes. And a still-declining manufacturing base and cutbacks in other industries are continuing to drive record numbers of upstate residents to other areas of the country,” she said. “Strong, strategic economic development efforts can be nothing short of transformative when properly deployed. Upstate New York desperately needs such a transformation to assure its long-term survival.”
She continued, “That recognition should be the guiding force in our economic development policies. Instead, we are ‘celebrating’ an enormous gift to a corporate giant that does not need it, to locate in a region of the state where job opportunities are plentiful. The winner in this deal isn’t New York and it certainly isn’t the taxpayers.”