Departures of Flying Dog, Guinness parent company reflect industry trends, experts say

Weeks after Guinness’s parent company filed plans to shutter its Baltimore County manufacturing plant, Flying Dog Brewery this week announced it will close its Frederick facility. But the departures are more indicative of industry trends than of a brewery problem in the state, say industry experts.

Guinness’s parent company, Diageo North America, plans to close its Baltimore County site on June 9, according to a March filing with the Maryland Department of Labor. The filing states that 108 people work at the site, but a spokesperson for Diageo wrote in an email that 97 roles will be impacted.

The Guinness Open Gate Brewery, which is adjacent to the manufacturing plant, will remain open and continue to brew beers.

Across the country, the beer marketplace is “showing a bit of contraction” as breweries adapt to a growing industry and consumers’ changing preferences, said Jim Bauckman, director of communications for the Brewers Association of Maryland.

“We’re not super excited,” Bauckman said of Flying Dog — the largest of Maryland’s 134 craft breweries — closing its Frederick production site.

FX Matt Brewing Company announced Tuesday that it was acquiring Flying Dog Brewery, which started out in Colorado but has been headquartered in Frederick since 2006.

The Utica, New York-based brewing company is looking for a location for a new Flying Dog taproom and innovation brewery in Frederick.

“Flying Dog has created an amazing brand, award-winning beers, and offers us a great opportunity to grow in the Mid-Atlantic region,” FX Matt Brewing CEO Fred Matt said in a statement.

FX Matt Brewing, founded in 1888 and the country’s fourth-oldest family-owned brewery, has been making many of Flying Dog’s beers for the last decade because of limitations at the Frederick brewery.

Flying Dog will shift all of its production to FX Matt Brewing and is expected to stop manufacturing at its Frederick facility in August, according to a news release.

Bauckman said the brewers association has seen a national trend of similar-sized breweries combining to expand their reach and broaden their selections.

And larger regional breweries, he said, have discovered they may have limited opportunities to grow their brand and choose to establish locations in other parts of the country to expand their reach.

“The industry is kind of growing up,” Bauckman said.

Maryland’s lawmakers and regulatory authorities have supported the state’s breweries, but the number of Marylanders patronizing breweries has not yet returned to pre-COVID levels, Bauckman said, adding that there are also a record number of breweries across the country and a limited number of spots on liquor store shelves.

Twenty years ago, there were fewer than 1,500 breweries in the country, according to the brewers association. By the end of 2022, there were more than 9,700.

Flying Dog CEO Jim Caruso wrote in an email that, at its Frederick location, Flying Dog was space-constrained, couldn’t produce craft beer in cans — which are in high demand — and had dated technology that was costing the company money and putting it at a significant disadvantage for growth in new and existing markets.

“Frederick is a great place to live and do business, but unfortunately even though we have invested millions of dollars in the brewery it … has too many limitations and puts Flying Dog at too great a competitive disadvantage,” Caruso said.

Flying Dog also couldn’t produce flavored malt beverages, hard cider, hard tea and ready-to-drink cocktails, which Caruso wrote need to be in cans and pasteurized for shelf stability. The brewery’s Frederick location doesn’t have a canning line or a pasteurizer, nor does it have the space to add them.

“This acquisition gives our brand immediate capabilities and flexibility to adapt to the changing consumer preferences,” Flying Dog CMO Ben Savage, who will become president of the Flying Dog division of FX Matt Brewing, said in a statement. “There will always be a market for great beer, but the lines between beer, cocktails, spirits, and wine continue to blur.”

Savage said that FX Matt Brewing will help Flying Dog promote its drinks and quickly develop new products in emerging categories of alcoholic beverages.

Caruso said it’s important that FX Matt Brewing offers employment opportunities to as many Flying Dog employees as possible. He also said his company will provide job placement assistance to its employees.

The headline and body of this story have both been updated to clarify that the Guinness Open Gate Brewery will remain open after Diageo North America’s manufacturing plant closes.