I was stunned by Gannett’s announcement it planned to close the regional printing operation adjacent to City Hall Oct. 6 and move the printing of El Paso Times and other group newspapers to Juárez. This was a $40 million investment when the plant went into service in 1997.
Employees at the facility were no less stunned. They will tell you they thought they were pretty well insulated from newspaper industry cutbacks since they also printed all the outlying chain newspapers, including Las Cruces, Carlsbad, Alamogordo, Deming, Ruidoso and others.
The only reason Gannet would shutter the plant would be to cash out on the property and equipment. In fact the company announced in February a refinancing deal and said it hoped to raise additional capital selling up to $125 million in assets this year.
It also seems likely the company has a hip pocket purchaser, and best bet would be the city of El Paso, which is said to have first right of refusal. You may recall the city demolished the old city hall to make way for the Chihuahuas ballpark and acquired what had been the El Paso Times offices at 300 N Campbell, which is the west side of the same building.
As I understand it, Gannett initially thought to move the printing for its area papers to Phoenix, where the company has another large plant. The downside is that would add seven or eight hours to the already early press deadlines, which is why you don’t have Friday night high school football results in the Saturday Times.
The trick now will be to see whether the Juárez plant, owned by Oswaldo Rodriguez Borunda, publisher of El Diario, is capable of handling their own publications as well as the new business from Gannett.
Printing in Juárez offers Gannett a big advantage in that labor is so much cheaper there. Personnel and newsprint represent the two greatest expense items in newspaper production, so printing there should represent considerable savings over printing in the United States.
Having lost some of our own printing clients to Juárez, I can tell you it is tough to compete with Mexico if you are paying better than U.S. minimum wage, Workers Comp and health insurance – expenses that do not exist in Mexico.
In fact, the El Paso Times will be saving so much money in its printing costs, I’ll bet they could offer a nice discount for subscriptions and advertising rates once they begin realizing the savings. Well, probably not.
One other advantage is that in the event the Times and other papers reduce daily circulation to less than seven days a week, they will not be saddled with idle U.S. pressmen. A lot of dailies are cutting the number of print days, and I note Gannett may have started easing into this trend by not producing a paper on Labor Day – the first time ever. Or they may have just wanted to avoid paying double time on the holiday.
Tom Fenton was editor, publisher and president of the Times from 1986 to 1993.