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MAY 2005

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ALABAMA SPOTLIGHT



Automotive Alabama Still On the Go
Honda announced a $70-million expansion of its plant in Lincoln. The factory assembles the Odyssey minivan.

    Cullman's cluster of automotive suppliers helped lure NVIC. More than 300 automotive manufacturing plants now dot the Alabama landscape, and more are on the way.
      In 2004, Honda announced a $70-million project to expand its engine plant at its manufacturing facility in Lincoln. Toyota announced a $250-million expansion to double production at its plant in Huntsville, adding 300 jobs to the Madison County factory that will supply all of Toyota's planned V-8 engine needs for North America.
      Ai3, which sequences parts for the Mercedes-Benz factory in Tuscaloosa, will build a $13-million, 400,000-sq.-ft. (37,160-sq.-m.) logistics center in Tuscaloosa County's Legacy Industrial Campus.
      Mando America Corp. announced that Opelika will become its North American headquarters; and MOBIS Alabama announced a $90-million expansion of its Montgomery operations, adding a plastic injection molding facility as well as a distribution center for service parts, creating 515 jobs.
      Steve Sewell, executive vice president of the Economic Development Partnership of Alabama, says that all of these projects were made possible by the early success of Mercedes, the first automaker to enter the state in 1994.
Toyota announced a $250-million expansion of its engine plant in Huntsville. The factory makes V-8 engines for Toyota trucks.

      "It sure helped our marketing efforts when we had companies like Mercedes, Honda, Boeing, Toyota and Hyundai come here and then share their success with the rest of the world," Sewell says.
      Sewell notes that "the work force of Alabama is the real key. That is the most important factor to the success of these world-class manufacturers. It all starts with a dedicated work force with a strong work ethic. We also have the best work-force training program in the country through AIDT. They are a big part of Alabama's success. AIDT will recruit, screen and train workers for new and expanding companies in this state. This is unquestionably the top incentive in our state."
      The only question now is, "Can the state handle yet another automotive assembly plant?" At press time, Toyota was conducting a nationwide search for up to two new assembly plant locations in North America. When asked if Alabama would compete for one of these two factories, Sewell says, "Alabama already has a relationship with Toyota and would want to be considered for more projects. Toyota is well aware of what assets the state has. Alabama has suitable sites for more assembly plants. We certainly have sites for large, mega-projects."
      One influential site selector tells Site Selection that Alabama should be careful before becoming too aggressive at recruiting another automotive OEM.
      "If Alabama refocuses its efforts toward suppliers and provides a competitive climate to allow the downstream and spin-off companies to thrive and prosper, then I think Alabama will continue to grow," says Ed McCallum, senior principal of McCallum Sweeney Consulting in Greenville, S.C. "If, on the other hand, they try to actively recruit another plant and ignore the other industries, I think Alabama will see a rapid slowdown."One region not slowing down is the Huntsville-Madison County area of Northeast Alabama. This booming job market is anchored by the Cummings Research Park, a 3,843-acre (1,556-hectare) complex that is the second largest research park in America.
      In 2004, the Huntsville market accounted for 5,461 new jobs, about half of which were directly attributable to aerospace and defense companies doing business in the park.Site Selection

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