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Area Development - Site Selection, Facility Planning and Workforce Development

Deere-Hitachi Construction Machinery Plans $97 Million Expansion At Its North Carolina Plant, Adding 340 Jobs

10/05/2012
Deere-Hitachi Construction Machinery Corporation, a manufacturer and distributor of excavators in the Americas, plans a $97 million expansion at its Forsyth County operations center in Kernersville, North Carolina, creating an estimated 340 jobs by the end of 2016.

Deere-Hitachi is a 50/50 joint venture between John Deere located in Moline, Ill. and Hitachi Construction Machinery Corporation in Tokyo, Japan.

"This investment will have a significant positive impact on the State of North Carolina, providing additional employment opportunities for Deere-Hitachi as well as many of our North Carolina-based suppliers," noted, Al Seeba, Chairman and CEO of Deere-Hitachi. "Deere-Hitachi has been manufacturing in the state since 1988, and we are pleased to partner with state and local officials to help make our vision a reality."

The expanded Kernersville facility will enable the company to manufacture additional excavators for the mining and construction industries, as well as keep up with demand for the 47-metric ton machine. At the Kernersville location, where it already has 743 employees, the company integrated its design and support functions, as well as manufacturing, information systems and training and support programs, enabling Deere-Hitachi to provide more value to customers.

The project was made possible in part by state grants from the Job Development Investment Grant and the One North Carolina Fund, said Gov. Bev Perdue. The company has been awarded a grant of up to $510,000 from the state's One North Carolina Fund. This fund assists the state in industry recruitment and expansion by providing financial assistance through local governments to attract business projects deemed by the governor to be vital to a healthy and growing state economy. One North Carolina Fund grants require a local match, and this grant is contingent upon approval of local incentives.

In addition, the state Economic Investment Committee voted to award a Job Development Investment Grant to Deere-Hitachi. JDIGs are awarded only to new and expanding businesses and industrial projects whose benefits exceed the costs to the state and which would not be undertaken in North Carolina without the grant.

Under the terms of JDIG, the company is eligible to receive a grant equal to 65 percent of the state personal income withholding taxes derived from the creation of new jobs for each of the nine years in which the company meets annual performance targets. If Deere-Hitachi meets the targets called for under the agreement and sustains them for nine years, the JDIG could yield as much as $3.5 million in maximum benefits for the company.

In addition, up to $877,000 could be added to the state's Utility Fund for infrastructure improvements in economically distressed counties. When a JDIG is awarded in the state's more economically prosperous counties such as Forsyth, 25 percent of the grant is allocated to the Utility Fund to encourage economic development in less prosperous counties.

"Companies like Deere-Hitachi recognize that North Carolina is a great place to thrive because of our top-notch business climate, incredibly well-trained workforce, and central location with access to customers and transportation channels," said Gov. Perdue. "When the company was ready to expand, North Carolina was the perfect choice." Perdue's met with executives of Hitachi on a recent trip to Japan to discuss its current presence in North Carolina and opportunities for it to grow.

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