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Gallo Shuts Lodi Crush Facility, Lays Off 20 Workers Amid California Wine Slump
Gallo, the United States’ largest family‑owned wine producer, announced on June 8 2026 that it would shut its Lodi crush facility on West Turner Road in San Joaquin County and lay off 20 employees.
The Lodi plant has long been a hub for growers who lack their own winemaking facilities. According to a Gallo spokesperson, the closure “reflects available capacity in our other wineries in the region.” The company will keep the Turner Road East site open for Tetra Pak blending, bottling and finished‑goods distribution.
Employees affected by the shutdown were individually notified and are receiving personalized transition support, including transition packages and opportunities to explore other roles within Gallo, the spokesperson said.
The Lodi shutdown is the latest in a wave of cuts that began earlier this year when Gallo announced the closure of three Bay Area locations, including the Ranch Winery in Helena, California. Those closures resulted in nearly 100 job losses. Last year, Gallo also shut its 300,000‑square‑foot Courtside Cellars winery in San Luis Obispo County.
California’s wine industry, worth roughly $55 billion, has experienced a third consecutive year of declining demand. The downturn has been driven by record drops in alcohol consumption, growing awareness of health risks associated with drinking, and competition from alternative beverages such as hard seltzers. A Silicon Valley Bank report published in January 2026 projected that U.S. wine sales would continue to decline in 2026, but not as sharply as in 2025, before leveling off in 2027 or 2028.
Industry analysts expect a gradual recovery, with Napa and Sonoma counties projected to rebound more quickly than other regions. Gallo has also announced staff reductions at several of its well‑known labels, including the Louis M. Martini Winery, the Orin Swift Tasting Room in St. Helena, and the J Vineyards and Frei Ranch operations in Healdsburg.
“Gallo is aligning parts of our operations with our long‑term business strategy to ensure we remain well‑positioned for future success,” a company spokesperson told the San Francisco Chronicle. “As part of this process, we made the difficult decision to reduce certain Wine Country operations. These changes are driven by market dynamics, evolving consumer demand, and available capacity across our wineries.”
The Lodi closure underscores the mounting challenges for California winemakers as the industry grapples with shrinking sales and shifting consumer preferences. While the company has not announced further closures, the pattern of layoffs and facility shutdowns suggests a continued focus on consolidating operations.
Gallo’s decision to close the Lodi crush facility and lay off 20 workers is a tangible illustration of the broader contraction in California’s wine sector. The company’s spokesperson emphasized that affected employees are receiving support, but the move signals a strategic shift toward more efficient use of existing production capacity.
As the industry awaits the next quarterly earnings reports, investors and stakeholders will monitor whether Gallo’s restructuring translates into improved profitability and whether the broader California wine market will begin to recover in the coming years.
The Lodi plant has long been a hub for growers who lack their own winemaking facilities. According to a Gallo spokesperson, the closure “reflects available capacity in our other wineries in the region.” The company will keep the Turner Road East site open for Tetra Pak blending, bottling and finished‑goods distribution.
Employees affected by the shutdown were individually notified and are receiving personalized transition support, including transition packages and opportunities to explore other roles within Gallo, the spokesperson said.
The Lodi shutdown is the latest in a wave of cuts that began earlier this year when Gallo announced the closure of three Bay Area locations, including the Ranch Winery in Helena, California. Those closures resulted in nearly 100 job losses. Last year, Gallo also shut its 300,000‑square‑foot Courtside Cellars winery in San Luis Obispo County.
California’s wine industry, worth roughly $55 billion, has experienced a third consecutive year of declining demand. The downturn has been driven by record drops in alcohol consumption, growing awareness of health risks associated with drinking, and competition from alternative beverages such as hard seltzers. A Silicon Valley Bank report published in January 2026 projected that U.S. wine sales would continue to decline in 2026, but not as sharply as in 2025, before leveling off in 2027 or 2028.
Industry analysts expect a gradual recovery, with Napa and Sonoma counties projected to rebound more quickly than other regions. Gallo has also announced staff reductions at several of its well‑known labels, including the Louis M. Martini Winery, the Orin Swift Tasting Room in St. Helena, and the J Vineyards and Frei Ranch operations in Healdsburg.
“Gallo is aligning parts of our operations with our long‑term business strategy to ensure we remain well‑positioned for future success,” a company spokesperson told the San Francisco Chronicle. “As part of this process, we made the difficult decision to reduce certain Wine Country operations. These changes are driven by market dynamics, evolving consumer demand, and available capacity across our wineries.”
The Lodi closure underscores the mounting challenges for California winemakers as the industry grapples with shrinking sales and shifting consumer preferences. While the company has not announced further closures, the pattern of layoffs and facility shutdowns suggests a continued focus on consolidating operations.
Gallo’s decision to close the Lodi crush facility and lay off 20 workers is a tangible illustration of the broader contraction in California’s wine sector. The company’s spokesperson emphasized that affected employees are receiving support, but the move signals a strategic shift toward more efficient use of existing production capacity.
As the industry awaits the next quarterly earnings reports, investors and stakeholders will monitor whether Gallo’s restructuring translates into improved profitability and whether the broader California wine market will begin to recover in the coming years.
