orth Carolina has won its third consecutive Prosperity Cup, which recognizes the competitiveness of state-level economic development agencies and their success in landing capital investment projects according to a 10-point index (see methodology). It’s in the heart of the Southeast, a region whose states consistently perform well in this and other Site Selection rankings. Georgia ranks second this year in the Prosperity Cup contest, followed by Ohio, Indiana and Kentucky.
Two projects alone in 2022 accounted for $9 billion in capital investment in the Tar Heel State — both in Chatham County. Vietnamese EV and battery manufacturer VinFast picked the Triangle Innovation Point mega site for its three-part manufacturing center — for production of electric cars, buses and batteries. A $2 billion initial investment for phase 1 is expected to grow to $4 billion. The project will employ 7,500 at full operation. Meanwhile, semiconductor manufacturer Wolfspeed plans to invest $5 billion over the next eight years in a manufacturing campus for the production of Silicon Carbide materials. It will create more than 1,800 jobs by 2030.
How did North Carolina win these trophy projects over competing states?
How North Carolina Wins
“It’s getting harder to site these facilities, because there aren’t as many of these big sites where companies can put these projects, and we still have them,” says Chris Chung, CEO of the Economic Development Partnership of North Carolina (EDPNC), in an interview. “In the case of Wolfspeed, which is based in Durham, they have a level of familiarity with the state, the business climate and the political leadership of the state that not every company will have.
Following are the criteria used to arrive at final scores determining the competitiveness ranking of the states. The first six criteria are based on project data resident in Site Selection’s Conway Projects Database:
“In the case of VinFast,” he adds, “it came down to having a site that could meet the timetable they were looking for, and the incentive package was part of that overall effort. Where they’re located in the region really helps them from a workforce standpoint. Their commitment is 7,500 employees long term, so the confidence they had in the talent pool was important, and it’s one of the things we think differentiates North Carolina from most of the other states we compete against.”
Chung says VinFast and Wolfspeed, as well as others like Boom Supersonic (building a $500 million Overture Superfactory in Greensboro) and Toyota Battery Manufacturing North Carolina (building an EV complex in Liberty) benefitted from special legislative appropriations to address major cost components of the projects. North Carolina does not have a fund set aside for landing such projects.
“At one time there was the perception that North Carolina was not very aggressive or good at figuring out how to incentivize those really large projects — the home runs would elude us,” he relates. “The home runs often require incentives that are not on the shelf. But in the past four years, the governor and legislature working in a bipartisan fashion have done a really good job of agreeing to disagree on other matters but coming together on major legislation as it befits companies like Apple and Honeywell’s headquarters relocation here a few years ago and others.”
What Stands Out
Among EDPNC’s business attraction and retention partners is the North Carolina Department of Commerce, directed by Commerce Secretary Machelle Baker Sanders. In April, Site Selection asked the Secretary for her take on North Carolina’s third consecutive Prosperity Cup.
“We have continued to leverage our strengths,” she says. “We have a collaborative environment. The Department of Commerce is a multiplier for our local and regional economic development agencies. We have continued to invest in and underscore the importance of our number one asset, which is our talent. Also, our excellent quality of life, our top-tiered education system, it’s unmatchable. It’s important for companies to locate in places that employees will enjoy and be able to thrive in. North Carolina offers all of that. That has kept us competitive.”
Machelle Baker Sanders
Secretary Sanders says some specific attributes help North Carolina stand out from competitive states in the Southeast and nationally, like having the largest manufacturing workforce in the Southeast.
“We have the largest concentration of historically Black colleges — that stands out. North Carolina Agricultural and Technical State University in Greensboro graduates more Black engineers than any university in the country. We have top-rated universities and colleges — that stands out. What North Carolina offers in terms of quality of life stands out relative to other Southeastern states and in the country. We’ve been ranked the best place to do business, so our business climate also sets us apart.
“The diversity of the state offers people a lot of choices, lifestyles and options and an excellent quality of life. You don’t have to travel far to get to the mountains or the beaches or large cities like Charlotte. That’s a true attraction.”
The Secretary recently attended an event at the site in Liberty where Toyota Battery Manufacturing North Carolina announced an additional $2.5 billion investment in addition to its initial $1.29 billion play. The complex will eventually employ 2,100. It was an eye-opening day, she recalls.
“Companies like Toyota can go anywhere in the world,” she noted. “But they chose North Carolina. I realized that because of what our state has to offer, that facility is well on its way to becoming operational. The impact of that project is far beyond what we see on the surface. It’s much more far-reaching. It was a competitive project, and being there to see the facility standing and the potential for further growth — that’s when you know you’re in the right place at the right time with the right people doing the right things.”
2023 State Rankings
Source: Conway Projects Database
Mark Arend has been editor in chief of Site Selection magazine since 2001. Prior to joining the editorial staff in 1997, he worked for 10 years in New York City at Wall Street Computer Review, ABA Banking Journal and Global Investment Technology. Mark graduated from the University of Hartford (Conn.) in 1985 and lives near Atlanta, Georgia.