NEW MEXICO SPOTLIGHT
New Mexico:
Eclipsing the Competition
Eclipsing the Competition
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ew Mexico is called the "Land of Enchantment" for good reason. Its towering mountains and colorful plateaus rich with Native American culture have been calling visitors westward for centuries.
But what many don't know is that tourists to Old Town and Santa Fe aren't the economic drivers for New Mexico. People with Ph.D.s are.
In fact, New Mexico has more Ph.D.s per capita than any other state in the nation - and that concentration of knowledge capital is fueling a high-tech manufacturing boom.
Consider the story of Eclipse Aviation. The brainchild of former Seattle software executive and entrepreneur Vern Raburn, Eclipse is a high-tech, advanced manufacturing company seeking to build the world's most affordable air taxi.
Called the Eclipse 500, the six-seat, twin-engine jet has already created a stir in the aviation world. Priced at about US$900,000, the aircraft could revolutionize the way business travelers get from town to town, especially when they aren't traveling between large commercial hubs.
Eclipse burst onto the corporate real estate scene in 2000 when Raburn announced that his fledgling company would build a $300-million factory and headquarters in Albuquerque. Beating out competing locations in Phoenix and Salt Lake City, Albuquerque landed a company that could eventually employ 2,000 workers.
"We had numerous criteria for Eclipse's home," Hall says. "Some examples are existence of an appropriate general aviation airport where an Eclipse campus could be built, availability of an appropriate work force, attractiveness as a destination for our customers, and weather conducive to flight operations."
The site search produced 62 initial candidate locations, which were narrowed to six finalists before the company chose Albuquerque.
"Albuquerque met our requirements well and, in addition, it offered a very attractive economic incentive package as well as tremendous support from the mayor's office, state government, Albuquerque Economic Development and others," Hall adds.
Today, the 200-employee Eclipse is a rapidly expanding company that has raised $238 million in venture capital and secured more than $65 million in non-refundable deposits for its breakthrough twinjet.
In fact, the company is growing so fast that on Nov. 6 it broke ground for construction of a 50,000-sq.-ft. (4,645-sq.-m.) friction stir welding center. The facility, set for completion this spring, is being built in the Broadway Industrial Center on the southwest side of Albuquerque. Waterman Inc., headquartered in Albuquerque, is managing construction of the plant.
"We are pleased to make yet another step toward delivering the Eclipse 500 jet in production volumes," said Raburn, president and CEO of Eclipse. The facility, he said, would support friction stir welding of up to 1,500 aircraft per year. More than 2,000 jets have already been ordered by customers of the firm.
A recent study by Economy.com found that New Mexico is one of the least expensive locations in the country for doing business. Using a research methodology that measured labor costs, state and local taxes, energy rates and office rents for every state and metro area in the U.S., Economy.com placed New Mexico among the cheapest 10 states in the nation including Wyoming, Kentucky, Oklahoma and Mississippi.
The paradox of New Mexico, however, is that it also offers one of the most highly educated work forces in the country. New Mexico is second among the 50 states in Ph.D. scientists and engineers as a percentage of the civilian work force, according to the National Science Foundation; and it's first in Ph.D.s per capita. The state is also second in federal obligations for research and development, first in high-tech exports as a percentage of total exports and second in R&D intensity.
On Oct. 23, Intel opened a $2-billion expansion of its manufacturing facility in Rio Rancho. Designated Fab11X, the new facility uses the semiconductor industry's most advanced manufacturing technologies to produce microprocessors on 300-mm wafers. Fab11X covers more than 1 million sq. ft. (92,900 sq. m.) and contains 200,000 sq. ft. (18,580 sq. m.) of clean-room space. The plant will transition this year to a 90-nanometer process technology.
"This expansion is the embodiment of our long-held belief that especially in the face of challenging economic times we must continue to invest in new products and manufacturing," said Paul Otellini, president and chief operating officer of Intel. "As computing and communications devices converge, the need for increasingly complex components with more capabilities will grow. This facility will help us meet that growing demand."
"We are sitting on a gold mine of technology at our laboratories and our research universities," says Rick Homans, the newly installed secretary of the New Mexico Department of Economic Development. "We want to attract to New Mexico the highest possible category of scientists. We are creating three new $5-million endowed chairs at the University of New Mexico, New Mexico State and New Mexico Tech. We want to attract Nobel Prize-winning scientists to New Mexico. They bring with them grants, they bring companies and they bring students. They are a form of economic development themselves."
The state also appears willing to put its money where its mouth is. Homans said the state government - one of only four in the nation to run a budget surplus - is seriously considering a 50-percent increase in the budget of the economic development department to outsource recruiting and marketing.
New Mexico, which is quite liberal in offering tax credits and training dollars to qualifying companies, is also about to become even more tax-friendly to businesses, notes Homans. New Gov. Bill Richardson is proposing a series of private and business tax cuts designed to stimulate the state's economy. The governor's plan includes reducing the personal income tax, cutting the capital gains tax in half and implementing eight new incentives that reward companies that create high-paying jobs.
ClientLogic announced Dec. 19, 2002, that it will hire as many as 500 new workers at its Albuquerque call center during the next several months. The Nashville, Tenn.-based company will receive more than $840,000 in state funds to train 273 new workers at its 47,000-sq.-ft. (4,366-sq.-m.) facility just off Interstate 25.
Nearby, Cardinal Health announced on Dec. 26, 2002, a $20-million expansion of its plant - a project that will add about 60 new jobs this year. The high-tech drug manufacturer supplies products to Eli Lilly, Merck Pharmaceutical and Wyeth.
But what many don't know is that tourists to Old Town and Santa Fe aren't the economic drivers for New Mexico. People with Ph.D.s are.
In fact, New Mexico has more Ph.D.s per capita than any other state in the nation - and that concentration of knowledge capital is fueling a high-tech manufacturing boom.
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Consider the story of Eclipse Aviation. The brainchild of former Seattle software executive and entrepreneur Vern Raburn, Eclipse is a high-tech, advanced manufacturing company seeking to build the world's most affordable air taxi.
Called the Eclipse 500, the six-seat, twin-engine jet has already created a stir in the aviation world. Priced at about US$900,000, the aircraft could revolutionize the way business travelers get from town to town, especially when they aren't traveling between large commercial hubs.
Eclipse burst onto the corporate real estate scene in 2000 when Raburn announced that his fledgling company would build a $300-million factory and headquarters in Albuquerque. Beating out competing locations in Phoenix and Salt Lake City, Albuquerque landed a company that could eventually employ 2,000 workers.
Albuquerque Topped 62 Contending Sites
The site selection followed a nationwide search conducted by Atlanta-based Lockwood Greene, says Dottie Hall, vice president of marketing for Eclipse and wife of company founder Raburn."We had numerous criteria for Eclipse's home," Hall says. "Some examples are existence of an appropriate general aviation airport where an Eclipse campus could be built, availability of an appropriate work force, attractiveness as a destination for our customers, and weather conducive to flight operations."
The site search produced 62 initial candidate locations, which were narrowed to six finalists before the company chose Albuquerque.
"Albuquerque met our requirements well and, in addition, it offered a very attractive economic incentive package as well as tremendous support from the mayor's office, state government, Albuquerque Economic Development and others," Hall adds.
Today, the 200-employee Eclipse is a rapidly expanding company that has raised $238 million in venture capital and secured more than $65 million in non-refundable deposits for its breakthrough twinjet.
In fact, the company is growing so fast that on Nov. 6 it broke ground for construction of a 50,000-sq.-ft. (4,645-sq.-m.) friction stir welding center. The facility, set for completion this spring, is being built in the Broadway Industrial Center on the southwest side of Albuquerque. Waterman Inc., headquartered in Albuquerque, is managing construction of the plant.
"We are pleased to make yet another step toward delivering the Eclipse 500 jet in production volumes," said Raburn, president and CEO of Eclipse. The facility, he said, would support friction stir welding of up to 1,500 aircraft per year. More than 2,000 jets have already been ordered by customers of the firm.
Low Costs, High-Level Skills
What Raburn knows - and what other corporate executives are coming to know about New Mexico - is that there's no substitute for a low-cost location that provides an abundance of highly skilled and multi-talented workers.A recent study by Economy.com found that New Mexico is one of the least expensive locations in the country for doing business. Using a research methodology that measured labor costs, state and local taxes, energy rates and office rents for every state and metro area in the U.S., Economy.com placed New Mexico among the cheapest 10 states in the nation including Wyoming, Kentucky, Oklahoma and Mississippi.
The paradox of New Mexico, however, is that it also offers one of the most highly educated work forces in the country. New Mexico is second among the 50 states in Ph.D. scientists and engineers as a percentage of the civilian work force, according to the National Science Foundation; and it's first in Ph.D.s per capita. The state is also second in federal obligations for research and development, first in high-tech exports as a percentage of total exports and second in R&D intensity.
Intel Part of High-Tech Sector
One reason New Mexico ranks so highly in these categories is its history of high-tech employers, particularly at the Las Alamos and Sandia national research labs and at Rio Rancho-based Intel Corp., located on a sprawling campus just outside of Albuquerque.On Oct. 23, Intel opened a $2-billion expansion of its manufacturing facility in Rio Rancho. Designated Fab11X, the new facility uses the semiconductor industry's most advanced manufacturing technologies to produce microprocessors on 300-mm wafers. Fab11X covers more than 1 million sq. ft. (92,900 sq. m.) and contains 200,000 sq. ft. (18,580 sq. m.) of clean-room space. The plant will transition this year to a 90-nanometer process technology.
"This expansion is the embodiment of our long-held belief that especially in the face of challenging economic times we must continue to invest in new products and manufacturing," said Paul Otellini, president and chief operating officer of Intel. "As computing and communications devices converge, the need for increasingly complex components with more capabilities will grow. This facility will help us meet that growing demand."
New ED Drives Aims for High-End Jobs
The corporate strategies driving the expansions of Eclipse and Intel mesh well with the new economic development strategies of New Mexico. The state's leaders told Site Selection that they don't want just any jobs in the Land of Enchantment; they want jobs that improve the standard of living of the state's residents."We are sitting on a gold mine of technology at our laboratories and our research universities," says Rick Homans, the newly installed secretary of the New Mexico Department of Economic Development. "We want to attract to New Mexico the highest possible category of scientists. We are creating three new $5-million endowed chairs at the University of New Mexico, New Mexico State and New Mexico Tech. We want to attract Nobel Prize-winning scientists to New Mexico. They bring with them grants, they bring companies and they bring students. They are a form of economic development themselves."
The state also appears willing to put its money where its mouth is. Homans said the state government - one of only four in the nation to run a budget surplus - is seriously considering a 50-percent increase in the budget of the economic development department to outsource recruiting and marketing.
New Mexico, which is quite liberal in offering tax credits and training dollars to qualifying companies, is also about to become even more tax-friendly to businesses, notes Homans. New Gov. Bill Richardson is proposing a series of private and business tax cuts designed to stimulate the state's economy. The governor's plan includes reducing the personal income tax, cutting the capital gains tax in half and implementing eight new incentives that reward companies that create high-paying jobs.
Two Major Projects Landed
Before First Legislation Passed
ClientLogic announced Dec. 19, 2002, that it will hire as many as 500 new workers at its Albuquerque call center during the next several months. The Nashville, Tenn.-based company will receive more than $840,000 in state funds to train 273 new workers at its 47,000-sq.-ft. (4,366-sq.-m.) facility just off Interstate 25.
Nearby, Cardinal Health announced on Dec. 26, 2002, a $20-million expansion of its plant - a project that will add about 60 new jobs this year. The high-tech drug manufacturer supplies products to Eli Lilly, Merck Pharmaceutical and Wyeth.