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 Southern Auto Corridor News

June 7, 2010

New VW Plant has Big Connections with Detroit and Mexico

We've never seen as much interest in the opening of a new foreign automotive plant in the Southern Automotive Corridor from auto parts suppliers in Michigan, Ohio and other old-line automotive states in the Midwest. Since Volkswagen announced in the summer of 2008 it had picked Chattanooga as the site of its first U.S. plant since the late 1980s, our Web site www.SouthernAutoCorridor.com has received hundreds of official inquiries from parts suppliers in and around Detroit. In fact, I would estimate that inquiries from Michigan off our Web site since VW announced have equaled if not surpassed inquiries from all other locations combined. That is how many there have been.

We can say with certainty that the interest from companies based in the Midwest in the prospects of supplying the German automaker's Chattanooga plant is 10 times or more of that of other foreign automotive plants that have been built or expanded in the South since SouthernAutoCorridor.com went live on the World Wide Web in 2003. Since then we have followed closely where inquiries were sourced prior or shortly after the opening of Honda and Hyundai in Alabama, Kia in Georgia, Toyota in Texas and Nissan in Mississippi.

We were curious why there was so much interest coming from the Midwest regarding the VW project and chalked it up to the reduced workload many of those suppliers faced as GM and Chrysler bellied up in 2009. But it turns out that Volkswagen must have made it clear early on to suppliers in the Midwest that it was interested in their products and services because it looks as if up to 25 suppliers in and around Detroit will end up with VW contracts. While there are dozens of Midwest-based suppliers providing parts for the 10 other foreign automotive plants in the region, almost every single one of them operate a facility near those plants. In Volkswagen's case, those 25 companies that will supply the Chattanooga plant will do so, at least initially, from their facilities in the Midwest. 

VW's Chattanooga plant will also work with approximately 40 suppliers in Mexico. That makes perfect sense since VW has operated a large plant in Puebla for decades. The German automaker will import engines to be installed in cars built in Tennessee initially from Europe and Mexico. 

As for the number of suppliers Volkswagen expects in and around Chattanooga, that figure is expected to be around 30 at some point before or after the plant opens next year.

mike@sb-d.com

Alabama Governor Launches Green Manufacturing Program for Parts Suppliers

In late May, Alabama Gov. Bob Riley announced the launch of a pilot program intended to help the state's automotive industry's parts suppliers reduce pollution and adopt green manufacturing technologies. Called Alabama E3, the program will help coordinate technical assistance programs offered by federal, state and local agencies. Alabama E3 will initially focus on 15 automotive parts suppliers in and around Tuscaloosa, Montgomery and Huntsville.  

Topura America Expands in Kentucky

Topura America Fastener, a manufacturer of automotive and industrial fasteners, announced in June it will add 30 new jobs and invest $9.34 million at its plant in Bowling Green, Ky. The deal will more than double the size of the company's existing plant.

Hyundai's Alabama Production Can't Keep Up with Demand

In May, Hyundai Motor Manufacturing Alabama had one of its busiest months since the Korean automaker opened its Montgomery, Ala. plant in 2005. The plant rolled out 28,000 Sonata and Sante Fe models and workers at the plant had to put in lots of overtime to produce that many vehicles. But sales of the two models in the U.S. and Canada totaled 31,439 in May and overall Hyundai sold 49,045 vehicles in the U.S. last month. The company reported that during the first five months of 2010 it sold 204,577 vehicles, the most ever of any five month period in the U.S. 

Volkswagen Opens Training Academy

In June, Volkswagen Group of America officially opened the Volkswagen Academy, the training facility that will prepare employees for work at the plant. The training center is supported by Chattanooga State and the University of Tennessee at Chattanooga.

Michelin Expanding in Small Town North Carolina

Michelin North America announced in the spring it is expanding its plant in Stanly County, N.C. The company plans to create 74 jobs and invest more than $11 million on the project. South Carolina-based Michelin employs more than 600 workers in North Carolina at facilities in Norwood, Asheboro and Salisbury. For more information on development in the rural South, go to www.SmallTownSouth.com.

Faurecia to Open Second Plant in Tuscaloosa

French auto parts supplier Faurecia announced in May it has purchased the former Visteon plant in Tuscaloosa, Ala. where it will manufacture automotive interior components for several OEMs. The deal is the second plant that Faurecia has announced in Tuscaloosa County in the past six months. The new facility, which will make parts for Nissan, will house 148 workers and represents an investment of $13.5 million. In November, the company announced plans to hire 198 at another Tuscaloosa County factory that produces seating for Mercedes-Benz. For more information on economic development in the South, go to www.SB-D.com.

German Supplier Opening Automotive Production Facility in S.C.

In May, Eberspaecher North America, which operates plants in Alabama, Michigan and Ontario, announced it will open a production facility in Greenville Co., S.C. The company is a manufacturer of exhaust systems. The new plant will serve BMW and its large assembly operation in Greer, S.C. The $5 million deal is expected to create 30 new jobs.

Automotive Casting Operation Re-Opens in Radford, Va.

Virginia Casting Industries, a ductile iron components manufacturer for the automotive industry, is reopening the former Intermet New River Foundry facility in Radford, Va. The $9.1 million project will create 300 new jobs. Virginia successfully competed with Michigan to land the project.

Parts Supplier Creating 55 Jobs in Rural North Carolina

WhiteRidge Plastics, a supplier of custom-molded parts for the automotive, industrial, agriculture and tool markets, announced in the spring it will expand its operations in Rockingham County, N.C. The company plans to created 55 jobs and invest more than $1.2 million in Reidsville.

Volkswagen Supplier Expanding in Tennessee

Miniature Precision Components (MPC), a supplier of thermoplastic injection molded, extrusion and blow molded products for the automotive, lawn and garden and commercial industries, announced in the spring it is expanding in Warren Co., Tenn. The company will invest $7.5 million and add 118 new jobs. MPC recently earned a contract to do work for Volkswagen's Chattanooga operations. 

Catalytic Converter Recycler Bringing Jobs to North Carolina

VSA LLC, a recycler of automotive catalytic converters, will locate its production plant in Burke County, N.C. The company plans to create 98 jobs and invest $4.5 million during the next two years in Morganton.

Caterpillar Supplier Hiring 400 in Seguin, Tex.

TPS, a supplier of component manufacturing and assembly services for Caterpillar, will hire 400 workers at a new plant in Seguin, Tex. to assemble diesel engines for the construction equipment giant. TPS is a subsidiary of Michigan-based Royal Oak Industries. TPS will operate out of an 800,000-square-foot facility currently being built on Seguin's west side.

Kaydon Expands in Sumter, S.C.

Michigan-based Kaydon Corporation announced in May it will invest $8.9 million and add 75 new jobs at its custom bearing facility in Sumter Co., S.C. The company has purchased a building formerly occupied by Bosch near the campus of its bearings facility, where it produces bearings for a wide range of general industrial markets. Kaydon also operates a wind turbine bearing facility in Sumter. The new facility is expected to open in the fall of 2010.

Bridgestone Celebrates 20 Years in Rural Tennessee

In the spring quarter, Bridgestone Americas celebrated the 20th anniversary of operations at its Warren Co., Tenn. facility. The plant was the first tire factory in the world to be awarded the LEED certification for its outstanding environmental building design. For more information on economic development in the rural South, go to www.SmallTownSouth.com.

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