n May at the Aegean Free Zone, or ESBASŞ, in Gaziemir, Turkey, a day before the groundbreaking for the $200-million Kale Pratt & Whitney joint venture aerospace plant, diesel engine and filtration giant Cummins held its own celebration for a $70-million filtration and components plant. The back-to-back ceremonies reinforced U.S.-Turkish business and military connections. For Cummins, the project was just one of several to take place in special economic zones.
"We have very ambitious plans for manufacturing in Turkey," said Anant Talaulicar, Cummins vice president, president of the components business and managing director of Tata Cummins Ltd. "This is only the beginning."
The project's first stage will involve the manufacture of air and oil filters. The next stage will feature the manufacture of alternators. Talaulicar said it was an example of the company's megasite concept, involving multiple factories to be built over a period of time, oriented toward different technologies.
A similar, but larger, concept is under way in India, where Cummins in January inaugurated its megasite and launched the development of three different plants on a 300-acre (121-hectare) site in Phaltan, Maharashtra. Half of the acreage is set up as a Domestic Tariff Area and the other half as a Special Economic Zone for exports. The first three plants that were launched were the second manufacturing facility of Tata Cummins Limited producing engines for commercial vehicles, power generation and industrial markets; an engine rebuild center; and a reconditioning facility for remanufacturing engines and components. The projects follow on MOUs signed in 2008. The model of co-locating and operating from a single campus will offer significant synergies to the Cummins companies, besides reducing cost of operation owing to economies of scale.
"We have significantly and profitably grown our businesses in India over the last few years and we expect this positive trend to continue in future," said Talaulicar on that occasion. "The expansions will cater to the increasing market demands and ensure that we continue to serve our customers well. The project will continue to generate significant employment opportunities for locals, and help develop ancillary industries in the Phaltan-Baramati area. Consistent with our core values, we are working closely with the local community to develop skilled work force by sponsoring the local ITI [industrial training institute], forming relationships with the colleges in Baramati and adopting nearby villages. We are working with the Government to develop the infrastructure to sustain industrial growth in and around Phaltan and I am delighted to say that we have received great support in these efforts."
A fourth facility — a parts distribution center — opened in August, when the company also broke ground on a fifth facility, an industrial engine upfit center. Total investments at the megasite have reached $100 million. Cummins anticipates investing a total of $400 million over the next few years.
The full list of SEZs in India, available on the website of the national government's Ministry of Commerce & Industry, features 143 operational zones. As documented in these pages in Sept. 2010 and Sept. 2011, most of these are devoted to IT and outsourcing services. But many also targeting such industry sectors as pharmaceuticals, electronics, aerospace and food processing.
The full list of SEZs formally approved by the national government since a 2005 policy directive features 582 zones. Those approved in principle number 42. Andhra Pradesh and Maharashtra lead the nation in overall number of zones, followed by Tamil Nadu, Karnataka, Haryana and Gujarat.
Back in the United States, Cummins' attraction to zones is taking the form of special-purpose subzone status granted by the U.S. Foreign Trade Zones Board in December 2010 to the company's engine component warehouse and distribution facility located in FTZ #77 in Memphis. Meanwhile, it continues to find its home state of Indiana one big zone, with an expansion at its engine plant in Seymour and plans to add up to 600 new jobs in its headquarters town of Columbus.
— Adam Bruns
ll you need to do is look at a map to get a handle on why West Memphis, Ark. makes strategic sense for any business relying on ready access to distribution channels. With I-55 and I-40 criss-crossing the city, any site in West Memphis is only minutes away from the third busiest section of interstate in the United States for truck traffic. And its central location makes it just a two-day truck drive to 75 percent of America's population centers, as well as Canada and Mexico.
But West Memphis is much more than a spot on a map. The city can offer a list of perks for business and industry nearly as long as the Mississippi River on which it sits — and near the top of the list are multiple business parks, a strategically located port and an invaluable Foreign Trade Zone designation.
West Memphis has four business parks, all within sight of interstates 40 and 55: Import Park, Mid-America Park, J.W. Rich Park and Interstate Commerce Park. All four have full utility access, all have an Insurance Services Office (ISO) fire rating of 2, and all are minutes from the Union Pacific Intermodal Yard.
The UP Intermodal Yard handles over 600,000 containers a year, 65% of which come from the Pacific Rim via the Ports of Los Angeles and Long Beach. That first glance at the map may not tell you that West Memphis has access to five class-one railroads and is the only location on the south Mississippi River with two mainline rail-bridge crossings.
Mid-America Park provides a dual electrical feed and fiber optic capabilities. And if all that weren't enough, Interstate Commerce Park is a designated Foreign Trade Zone and the other three are eligible as sub-zones.
Foreign Trade Zone
City officials applied for the Foreign Trade Zone (FTZ) designation in 2007 and the FTZ status for Interstate Commerce Park was granted in 2008. Developed by Industrial Developments International (IDI), the 340-acre site that makes up FTZ #273 already has one pad-ready site of 453,600 square feet, which can be expanded to accommodate a facility of up to 900,000 square feet.
An FTZ is an effective cost-cutting perk for businesses that allows domestic activity on foreign items prior to a formal customs entry and essentially allows re-exported merchandise to receive duty-free treatment, while duty payment is deferred on items sold domestically. According to the International Trade Administration of the Department of Commerce, the designation aims to offset "customs advantages available to overseas producers."
In simple terms, FTZs save companies money because they don't pay duties for products or components shipped into the zone and can assemble the components in the duty-free zones, then ship them out. Only when the final product is transferred from an FTZ and formally entered into U.S. commerce do duties and taxes become due. And, if the final product is exported from the U.S., no duties or taxes are levied.
Mississippi River transportation plays an important role in grain, petroleum and steel logistics — and the Port of West Memphis is a huge advantage for any of those users locating here.
One of the port's pluses is its dependability. Unlike regional, slack water harbors where silting causes ongoing maintenance issues or low water conditions cause closures, the Port of West Memphis is a deep water port located in the main channel and has never closed due to low water.
With a loading capacity of 100 tons, the port operates a general-purpose river terminal and a special-purpose grain terminal, some with direct-to-truck access. Both are within five miles of Interstates 40 and 55.
Recently, the city commissioned the creation of a Master Rail Plan for a 2,500-acre rail-port logistics park to be built adjacent to the port. The planned park will include approximately 11 million square feet of rail-served industrial space for distribution centers, light assembly facilities and packing/repacking operations.
Turn to West Memphis
Of course, these are just three of the perks that make West Memphis a list-topping choice for site selectors in multiple industries. Low utility and property taxes and a growing, made-to-order workforce — thanks in large part to Workforce Technology Center at the city's Mid-South Community College — are also reasons this Northeastern Arkansas city is a no-brainer for business.
In an increasingly complex, competitive and global marketplace, leaders from companies large and small, and in just about any industry can't go wrong when they choose to Turn to West Memphis.
he El Paso International Airport (EPIA) is in pursuit of strong visionaries with the demonstrated financial and management experience to develop a series of industrial and/or commercial sites in an expanding market place.The first completed phase of the development includes the award-winning, Butterfield Trail Golf Club (BTGC) which further adds value to the area.
EPIA is looking for an entity to implement initial master plans, develop and lease to a strong customer base including defense contractors and U.S./Mexico twin plant operations. This exclusive area is ideally situated adjacent to Fort Bliss, the fastest-growing U.S. Army installation, the border's largest Air Cargo Center, and the Tom Fazio-designed BTGC.
A 13-acre site has been reserved for a full-service business hotel with superb views of the golf course. This unique opportunity is offered to any entity with strong management experience, and the capacity to build and manage a full-service hotel.
Science & Technology Park
The shovel-ready Global Reach Science and Technology Park, a 150- acre site, is now available for development for industrial, commercial, and retail purposes. Fully served with all utilities, and infrastructure, this property is situated on Foreign Trade Zone No. 68 designated land, and adjacent to EPIA's Air Cargo Complex.
For more information visit www.flyelpaso.com or call 915-780-4720
esperia is located along both Interstate 15 and US Highway 395, in southern California. Framed by impressive mountain ranges, this gateway to the high desert features a temperate climate with clean air, abundant sunshine, and large tracts of available land. With 17 miles of freeway frontage, Hesperia offers easy access to 366,000 High Desert residents and proximity to 20 million residents in southern California.
The region is becoming a major distribution and logistics hub serving one of the world's largest international trade areas. Completion of Hesperia's industrial rail lead track is slated for 1st quarter 2012 and is accessible to large parcels of city-owned land. Hesperia's track will connect to the Burlington Northern Santa Fe mainline with access to points south of San Diego and north into Canada. This makes rail transportation with BNSF or Union Pacific effortless between Hesperia and LAX airport or the ports of Los Angeles and Long Beach. In addition, a site in Hesperia means goods can be distributed by truck to 11 western states within 24 hours.
The recent designation of much of Hesperia as a California Enterprise Zone means that businesses "in the zone" qualify for substantial state tax benefits and incentives. These include an array of cost-savings and advantages such as hiring and wage credits, net operating loss deductions, business expense deductions, sales or use tax credits, and more. These benefits can be quite lucrative, with reductions in the cost of doing business ranging from thousands to hundreds of thousands of dollars annually.
A second new state designation has targeted Hesperia as an area incentivized to promote recycling and reduce landfill waste. The Hesperia Recycling Market Development Zone combines state benefits, such as below market-rate loans. In addition, some participating businesses may receive market identification and research, business planning, marketing, and technical assistance.
The City of Hesperia has a wealth of resources and individualized assistance available to businesses looking to expand or locate their companies in the City of Hesperia. For more information, visit www.cityofhesperia.us/econdev, call Steven J. Lantsberger, CED, at 760- 947-1906 or e-mail email@example.com.