Overview: Modesto-based packaging firm G3 Enterprises announced plans to lay off 66 workers at its wine closure plant this fall. The move reflects a statewide shakeout driven by declining demand, rising costs, and an oversupply of grapes affecting California’s wine sector.
The Full Story
By Iris Kwok Staff Writer Aug. 14, 2026. G3 Enterprises said the challenges faced by the broader wine industry — declining consumer demand, inflation, rising expenses and increased competition — prompted the cuts. Laura Bream, the company’s vice president of human resources, stated in a statement that changes in customer purchasing patterns and production volumes contributed to the need for restructuring. In total, 66 workers at the site, most of whom work in closure operations, will be laid off between Oct. 6 and Dec. 31, according to the Worker Adjustment and Retraining Notification letter filed with the state. The company expects the layoffs to be permanent.
Bream said the Modesto facility, which finishes and manufactures several types of beverage closures, will remain in operation. The planned layoffs are only for jobs related to wine screw caps, she said. The facility plans to continue making other types of screw caps, capsule and Diam cork closures.
Production & Profile
G3 Enterprises provides integrated packaging and logistics solutions to the wine industry, from grape to glass. The company offers a range of agricultural supply chain services, such as almond transportation, rice trucking and fertilizer transportation. Its website prominently features the logos of Gallo, the vodka seltzer brand High Noon, and New Amsterdam Vodka among its more than 2,000 customers across the food, beverage and real estate industries.
Brand & Industry History
G3 Enterprises was formed in 2003 following the merger of a trucking company, an aluminum closure maker, an agricultural transport company and a label printing company. The “G3” in the company name references a nickname for the third generation of the Gallo clan, but Gallo and G3 Enterprises are legally independent companies. Gallo owns both High Noon and New Amsterdam Vodka. In February, alcoholic beverage behemoth Constellation Brands announced plans to lay off 212 workers at its Mission Bell Winery in Madera. The publicly traded company, which owns Robert Mondavi wines and Modelo and Corona beers, has set a goal of $200 million in cost savings by 2028 and is shifting away from wine to focus more on its growing beer business. That month, Santa Rosa-based Foley Family Wines & Spirits wound down operations at its Chalone Vineyard in Monterey and laid off the entire wine-making staff at Chalone, though it plans to keep producing the Chalone label wine that was enjoyed by Julia Child.
What This Means
At the heart of the wine industry’s crisis is a basic supply and demand problem: too many grapes and not enough buyers, industry experts told The Times this year. Consumer demand is shrinking because boomers — the industry’s biggest fans — are aging out of the wine market. Younger generations drink less alcohol in general and are less likely to choose wine. The wine industry has lost drinkers to premium beers and spirits. “At this point, the entire industry, and it’s not just California, recognizes that there’s a consumer change,” Rob McMillan, wine business analyst at Silicon Valley Bank, said about the wine cap layoffs. Consumers have lately favored premium wines, which sell in lower volumes, McMillan said. Lower-priced categories, which sell in higher volumes, have performed poorly. Makers of corks, capsules and bottles have been hit because overall U.S. wine volume has continued to decline. But there may be hope ahead. “We’re starting to get near the bottom,” McMillan said, adding that he believes the U.S. wine industry should stabilize in the next two years.
Consumer Takeaway
The Modesto facility continues making other types of closures while restructuring screw cap operations. Industry analysts expect the downturn to bottom out within two years as market dynamics shift toward premium, lower-volume wines and away from mass-market sales.
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