There’s Never Good Timing for Bad News
It came out the other day that the New Era Cap Company plant in Derby, will be closing in March. The company told it's more than 200 employees that New Era's presence in Derby is going away. For the 200 plus families that will be affected by the shutdown, it's not the kind of news you want to get just before the holidays.
This is New Era’s only head-wear-manufacturing plant in the country, manufacturing upwards of 3 million caps a year. That includes all of the hats worn by MLB players. The worst part is most of those jobs are being shipped out of the country. Most, because it's been reported that manufacturing for all the caps worn by MLB players is being shifted to a New Era plant in Miami. Why Miami? Their deal with the MLB has a clause that requires that those hats be made in the United States.
Why is the plant closing? Money? Taxes? Tariffs? A lot of people have been asking and speculating over the news for the past few days. According to buffalonews.com, it comes down to one thing; a shift in New Era's business model. They've reportedly made the decision to move from manufacturing, which is what they've done for the past 98 years, to branding.
Keeping the MLB portion of the contract in Miami makes sure they're not in breach of contract. But sending the manufacturing of the caps out of the country to places like China, Vietnam, and Haiti, where they've already farmed out a significant portion of their manufacturing, helps them pivot the company to focus on the brand itself.
That does little to satisfy the over 200 families, not to mention the communities, that are already being affected by the news.
New Era CEO Chris Koch, whose whose great-grandfather founded the company back in 1920, didn't do any interviews when the news came out on Tuesday. He did, however, release a statement:
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. 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.