< Previous38 KENTUCKY ECONOMIC DEVELOPMENT GUIDE W hy did more than two dozen companies announce more than $860 million in logistics- related facilities in Kentucky in 2024? Perhaps because it’s home to 2,300 miles of Class I railroad track and 1,000 miles of commercially navigable waterways. Or it might be the commonwealth’s six Interstate highways and five commercial airports. Maybe it’s the foreign trade zones in the area that afford companies import and export benefits. by MARK AREND The Logical Location For Logistics [ DISTRIBUTION & LOGISTICS ] Kentucky is the nation’s leader in air cargo by weight and home to international hubs for DHL, UPS and Amazon. Photo courtesy of the Office of the GovernorKENTUCKY ECONOMIC DEVELOPMENT GUIDE 39 It’s likely a combination of those infrastructure assets. But add proximity to air cargo hubs operated by UPS at Louisville Muhammad Ali International Airport and DHL and Amazon at Cincinnati/Northern Kentucky International Airport (CVG) and Kentucky quickly becomes a logical location for logistics-intensive businesses. Since 2017, according to the Kentucky Cabinet for Economic Development, the commonwealth has seen nearly 250 new or expanded logistics-related facilities built, worth more than $5.7 billion in capital investment. Combined, they have created more than 18,600 jobs. Investments in Efficiency In October, ground broke on a new, LEED-certified aviation maintenance facility DHL Express is building at its Global Hub at CVG. The $292 million investment will result in 300 new jobs. “Over the last several years, we have been enhancing our network capabilities with newer and more fuel- efficient aircraft, and this new facility complements those efforts with additional space for more aircraft to be maintained at the same time,” said Rob Hyslop, EVP Global Aviation, DHL Express, at the groundbreaking. “This translates into faster turnaround times, making the fleet 40 KENTUCKY ECONOMIC DEVELOPMENT GUIDE The Amazon Prime Air Hub in Hebron in Boone County is located at the Cincinnati/Northern Kentucky International Airport. It serves as Amazon’s main logistics hub for air cargo across North America. All photos courtesy of Kentucky Cabinet for Economic Development more efficient to handle a growing volume of shipments.” In September 2023, DHL eCommerce opened a 307,000-sq.- ft. distribution center in Hebron, Kentucky, near CVG. It’s consolidating three leased properties into the new $74 million distribution center that will employ approximately 400 full and part- time employees. The UPS Worldport at Louisville is one of the largest automated package handling and air freight hubs in the world, at 5.2 million sq. ft. Recent investments include an expanded Global Aviation Training Center and a second 275,000-sq.- ft. hangar. Clark Beverage Group and Clark Distributing Company (Clark Group) announced in October a nearly $130 million investment to expand and establish a new, 300,000-sq.-ft. corporate headquarters and distribution facility in Bowling Green. It will create 20 new jobs, bringing its employee roster to more than 260 workers. The company cited Warren County’s “strategic location, talented workforce and welcoming business environment” as the criteria for growing in Bowling Green. Chick-fil-A Supply, a division of the Chick-fil-A restaurant corporation, announced plans in December for a new, $100-million, more-than-270,000-sq.-ft. distribution facility in Elsmere, near CVG airport, that is forecast to create 178 full-time jobs over five years. It will supply approximately 150 Chick-fil-A restaurants in the region. “Elsmere not only provides access to quality talent, but its unique location will also allow us to receive product by rail — the third distribution center in our network to do so,” said Josh Grote, executive director of Chick-fil-A Supply, in a statement. KENTUCKY ECONOMIC DEVELOPMENT GUIDE 41 ‘AT THE CROSSROADS OF OUR NATION’S LOGISTIC NETWORK’ I n December 2023, TRIP, a national transportation research nonprofit in Washington, D.C., released a report that details current and projected levels of freight movement in the U.S., among other topics. “America’s Rolling Warehouses: Opportunities and Challenges with the Nation’s Freight Delivery System” ranks Kentucky 15th in the nation in the value of freight shipped my all modes in 2022, at $605 billion. Kentucky’s freight system moved 502 million tons of freight that year. From 2022 to 2050, freight moved annually in Kentucky by trucks is expected to increase 53% by weight and 99% in value (inflation- adjusted dollars), the 11th highest projected increase in the nation, according to a TRIP release. The report also found that 16% of travel on Kentucky’s Interstate highways and 20% of travel on its rural Interstate highways is by combination trucks. “We are pleased to see the projected growth continue for Kentucky,” said Jennifer Kirchner, executive director of Kentuckians for Better Transportation. “We are a national leader in freight movement because we are at the crossroads of our nation’s logistic network. Being centrally located is an opportunity for us and investment in transportation infrastructure is foundational to our success, as we see with the advancement of the Brent Spence Bridge.” Opened in November 1963, the Brent Spence Bridge carries Interstates 71 and 75 across the Ohio River between Covington, Kentucky, and Cincinnati, Ohio. A companion bridge is being built to alleviate traffic congestion. Photo of John F. Kennedy Memorial Bridge in Louisville courtesy of Kentucky CEDW hen you’re the No. state for passenger vehicle production per capita, the critical mass draws in more investment like metal fi lings to a magnet. e map in a report on the industry’s economic impact from the Center for Automotive Research demonstrates why, with the commonwealth directly in the center of the I- automotive industry corridor, employing more than , in direct motor vehicle and parts manufacturing alone (more than , in automotive- related establishments overall). Moreover, the east south central region with Kentucky at its heart is responsible for more indirect automotive jobs across the entire nation than any other region. e more than automotive projects tracked in Kentucky in by Site Selection magazine’s Conway Projects Database only further cement the commonwealth’s reputation, especially when all but seven of them came from companies already based in the state. And especially when one of them was the state’s largest capital investment of the year. at would be the $ million advanced paint facility investment being made by Toyota Motor Manufacturing Kentucky (TMMK) at its manufacturing complex in Georgetown. Scheduled to open in , the facility will add million sq. . of capacity while decreasing carbon emissions by % and water usage by . million gallons per year, the company said. Earlier in , TMMK pledged to grow an investment announced in to $ . billion at the Georgetown site to bring assembly of an all-new, three-row battery electric SUV to the U.S. market in . e company’s electric push is part of $ . billion in new Kentucky investment from EV-related projects, AUTOMOTIVE Workers at the Toyota Motor Manufacturing Kentucky plant in Georgetown Photo courtesy of TMMK by ADAM BRUNS AUTOMOTIVE INDUSTRY DRIVES KENTUCKY’S ECONOMY FORWARD 42 KENTUCKY ECONOMIC DEVELOPMENT GUIDEwhich aim to deliver more than , full-time jobs. Toyota’s investment in Kentucky has reached more than $ billion since the company broke ground in Georgetown in — an average of $ million per year. And education and workforce development have been central to the more than $ million in local donations Toyota has made in Kentucky since launching construction in . at long-term commitment is reciprocated by the talent on hand in the commonwealth. “ is year alone more than $ billion is being reinvested in our plant and further supports Toyota’s promise of long-term job security for our team members,” said Kerry Creech, president of Toyota Kentucky, who symbolizes that long term himself, having begun his career as a powertrain production team member at Toyota Kentucky in . Equal in strength to the , -strong Georgetown operation is Toyota’s nationwide network of more than suppliers, including over in Kentucky. Vuteq, for example, was recently approved by local planning commissioners in Georgetown for a , -sq.- . expansion at Georgetown Industrial Park because it needs to add new injection tools to help service new contracts for part numbers. Such investments are part of a surge of automotive projects that totals $$ . billion announced since and can best be explored by a driving tour on the state’s superior highways to the latest hot spots. Here are a few of them, all supported by an array of incentive programs: Glendale, Hardin County: Ford Motor Co. and SK On, $ . billion, , jobs : BlueOval SK Battery Park continues apace with hundreds hired since the BOSK joint venture saw the June opening of the Elizabethtown Community and Technical College (ECTC) BlueOval SK Training Center to begin providing onboarding and training. More than , employees had already been trained in the year previous to that facility’s opening. BOSK’s Kentucky plant is expected to start up production in . Bowling Green, Warren County: AESC, $ billion, , jobs; PEAK Precision Manufacturing, $ million, jobs: Industrial momentum in Bowling Green is so strong that the Warren County Water District is keeping pace with miles of new water line and another miles of new sewer line to support growth. e AESC EV battery manufacturing campus continues on its own pace to attain full production capacity in . PEAK Precision describes itself as “a startup mass production and manufacturing business that fabricates metal parts to service industrial sectors across the automotive, agricultural, defense, steel and aluminum platforms.” It aims to be operational before the end of . “Our team is ready to leverage our expertise in CNC machining and There are + automotive- related facilities in Kentucky. KENTUCKY ECONOMIC DEVELOPMENT GUIDE 43 Portrait of Longevity: Toyota Motor Manufacturing Kentucky President Kerry Creech started his career as a powertrain production team member at Toyota Kentucky in 1990.mass production to meet pressing manufacturing needs within our industry,” said Steve Allen, PEAK Precision CEO, at the July announcement. “We have been fortunate to secure initial contracts during the start-up phase, and we look forward to utilizing our outstanding leadership team to help take this company to new heights in a very short amount of time.” Frankfort, Franklin County:Nitto, jobs: e Japanese manufacturer of high-performance materials for automotive, electronics, aerospace and other industries announced in January it will open a new plant in Franklin County’s Industrial Park by spring . “Nitto is excited to put down roots in the capital city and to welcome our team to the area in ,” said Yukihiro Horikawa, president of Nitto Inc. “ e access to our customers is unparallelled in the Bluegrass region.” It’s the largest job creation announcement in Frankfort/ Franklin County since . Science Hill, Pulaski County: Ridgenet Network Group LLC, $ . million, jobs : is manufacturer of equipment for emergency vehicles and other compo- nents used in law enforcement, fi re and EMS will use a new facility to triple its production of upfi tted vehicles and qua- druple its warehouse space. “We saw a need for emergency upfi t services in this area, so we took a chance, started a small company based in our hometown and grew it into what it is today,” said Ridgenet Network Group CEO Eric Wilson at the October announcement. He founded the com- pany as an internet service provider in with his brother Alex, pivoting to equipment provision for fi rst respond- ers in . “Being that we are both fi rst responders, my brother and I know fi rsthand how crucial the services we provide are and how they aff ect the safety of emergency services. is expansion will allow us to expand our footprint, in- crease the quality of our builds and allow for additional services to be added.” “Ridgenet is a company that has shown, time and again, the spirit of economic development here in Pulaski County,” said Pulaski County Judge/ Executive Marshall Todd. “ ey cover everything from emergency vehicle upfi t- ting to mission critical radio communi- cations and we are glad they are located here locally.” Boone County (Northern Kentucky): Mubea, $ . million, jobs: e German supplier of lightweight products for automotive chassis, bodies and powertrains plans to renovate an existing building to accommodate additional spring wire and coil spring production. BE NKY Growth Partnership CEO Lee Crume noted at the August announcement that a Kentucky delegation had a productive meeting with Mubea executives at their headquarters in Germany two months earlier. “Mubea has been part of the commonwealth’s expansive logistics and distribution sector for more than four decades,” said Gov. Andy Beshear in August , “and I’m excited to see them continue to grow here.” Maysville, Mason County: Mitsubishi Electric US, $ . million, jobs: As the automotive industry evolves, Kentucky companies and talent evolve with it, even if it means a transition into other sectors. Mitsubishi Electric US (MEUS) in July announced plans to establish the fi rst-ever U.S. factory Mitsubishi Electric US, operating in Kentucky since 1995, is investing $143.5 million and creating 122 jobs through repurposing its plant in Maysville. Photo courtesy of MEUS One out of every workers in the U.S. automotive industry works in Kentucky, where over , individuals are employed in automotive- related establishments. 44 KENTUCKY ECONOMIC DEVELOPMENT GUIDEKENTUCKY ECONOMIC DEVELOPMENT GUIDE 45 to build advanced twin-rotary variable capacity compressors, the key technology used in Mitsubishi Electric Trane HVAC US (METUS) highly effi cient heat pump systems for commercial and residential buildings. MEUS has been manufacturing automotive components in the state since , helped by training collaborations with Morehead State University and Maysville Community and Technical College. In this case, the Japan-based company — Maysville’s second largest employer — is cementing its loyalty to the community through repurposing one of its existing internal combustion-oriented manufacturing facilities for the new work, much of which has been executed in Asia up to now. As with the Mubea project, the new investment commitment followed a visit by Gov. Beshear and his team with Mitsubishi Electric executives in their home country. It was the culmination of an -month process involving all levels of state and local government. “Mitsubishi Electric is grateful to the Commonwealth of Kentucky for providing incentives to ensure we maintain our manufacturing presence in the Bluegrass State,” said Mike Corbo, president and CEO of Mitsubishi Electric US. “Creating technologies that support vibrant and sustainable societies is at our company’s core. is repurposed facility brings the production of compressors for our highly effi cient heat pump systems here to the U.S., and with that new jobs and investments in technology that make American homes more comfortable, more sustainable and less expensive to heat and cool. is collaboration is a huge step toward many of our shared goals.” 46 KENTUCKY ECONOMIC DEVELOPMENT GUIDE N ow 40 years old, the Bluegrass State Skills Corporation (BSSC), operated within the Kentucky Cabinet for Economic Development, makes every year count. A Ready Talent Base Mike Yoder knows the BSSC program well, having overseen it at the Kentucky Cabinet for Economic Development before recently being appointed interim commissioner of the Department of Workforce Development (DWD) within the Kentucky Education and Labor Cabinet. The agencies of the DWD, the Office of Vocational Rehabilitation and the Office of Employer and Apprenticeship Services work together to provide services through the Kentucky Career Center. Also, under the direction of DWD is the Office of Adult Education. “One of the values of BSSC is it’s the industries doing the actual training,” said. “For me, the key differentiator is it’s not a specialized training program. It’s companies investing in their employees and doing so in a way that is beneficial for their industries.” One of the most frequent beneficiaries, Ford, is a case in point. While training employees at its Louisville facilities, it by ADAM BRUNS Many Workforce Players, ONE TEAM KENTUCKY Many Workforce Players, ONE TEAM KENTUCKY [ WORKFORCE ] Photo by Charity Hedges courtesy of Kentucky Cabinet for Economic DevelopmentNext >