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South Carolina: Diverse Manufacturing Sectors Poised for Economic Recovery

Mali R. Schantz-Feld (June/July 09)
BMW BMW's Spartanburg plant is the only BMW manufacturing facility in the U.S
The current recession affects nearly every industry in every region and state regardless of which industries are dominant, according to Don Schunk, Ph.D., research economist at Coastal Carolina University. However, economies such as South Carolina's that rely heavily on manufacturing, housing, and consumer spending, will need to work harder during the expected economic recovery.

From its automotive cluster to textile plants, Schunk believes one of the greatest challenges is maintaining a technologically-skilled work force. "South Carolina is an attractive location for new industry, including manufacturers and warehousing and distribution centers (such as already established Target and Walmart distribution centers)," he says. He credits South Carolina's port access through both the Charleston ports and the Port of Georgetown, and coverage from interstate highways.


Lewis Gossett, president of South Carolina Manufacturers Alliance, adds that the Palmetto State is focused on energy - nuclear, wind, coal, and hydrogen. With four nuclear plants already in the state, nuclear facilities are "not just a source for our power, but also for future research, manufacturing, and construction opportunities," he says, citing possible partnerships with companies such as Westinghouse, Savannah River Nuclear Solutions, Duke/Fluor Daniel, Areva, and DuPont. Gossett says that Duke Energy, Santee Cooper, and SCANA Corporation are all involved with developing nuclear projects.

Projects are ongoing at the 310-square-mile Savannah River Site (SRS), owned by the Department of Energy, with Savannah River Nuclear Solutions (SRNS) as the management and operating contractor and SRNS partners Fluor Daniel, Northrop Grumman, and Honeywell. SRS is responsible for environmental stewardship, environmental cleanup, waste management, disposition of nuclear materials, and development and deployment of technologies geared towards the environment and treatment of nuclear and hazardous wastes. Also on the site, the Savannah River National Laboratory focuses on homeland security, energy security, and environmental management. Chuck Munns, president and CEO, notes that the firm "is pleased to be a part of the Savannah River Site. For years our parent company has had a strong presence in this area, so we feel very at home here. We are privileged to be entrusted with a large portion of work under the American Recovery and Reinvestment Act (ARRA), as well as our normal, day-to-day work for the nation."

Manufacturing consolidations also present growth opportunities. American LaFrance LLC, manufacturer of fire, rescue, and EMS vehicles, is consolidating operations to Berkeley County, and Crane Co. is consolidating North American vending machine operations into its Dixie-Narco facility in Williston, potentially increasing employment by 1,000 jobs over the next five years.

Johnson Controls Inc. plans to locate a $100 million innovative battery recycling operation in Florence County that will create 250 new jobs. The company already provides more than 1,000 jobs in the nearby region, including at its distribution center in Florence and a manufacturing facility in Oconee. "Florence is attractive to us for a variety of reasons," says Brian Kesseler, a company vice president. "First, there is a gap in the mid-Atlantic region for automotive battery recycling. With millions of spent automotive batteries coming from the region annually, it makes sense to build a recycling facility nearby. Second, the location is ideally situated to serve our existing manufacturing and distribution facilities in the Carolinas. And finally, with our experience at our other facilities in South Carolina, and specifically in Florence, we have been very impressed with the quality of work and the quality of life the state provides."

In the auto sector, as part of a three-year construction project, BMW is investing an additional $750 million in its Spartanburg factory, adding 1.5 million square feet and 500 new jobs by 2012. The expansion of the plant translates to a bigger purchase and export volume in and from the NAFTA region. Josef Kerscher, president of BMW Manufacturing, has noted that while the supplier network may grow, existing supplier companies will ramp up operations to provide automotive parts for the higher production levels, doubling parts container traffic and significantly increasing exports through the Port of Charleston.

Another project, a titanium mini-mill facility by American Titanium Works, is fundraising in Laurens County. The Chicago-based firm plans to invest an estimated $422 million and employ 320 people at its new facility, as well as establish an applications development and engineering technical center in Greenville County at Clemson University's International Center for Automotive Research (CU-ICAR), creating 40 applied engineering jobs that will specialize in prototype development and fabrication techniques for multiple industry sectors. Recruitment efforts are being aided by the state's work force training program. "We have been consistently impressed with the state, local, and county commitment to our project from the beginning," says Tom Sax, the firm's president and CEO. "In the end, the incentives programs between competing states were very close, but it came down to the commitment of the state and local officials, the good business environment, and the quality of life in the upstate region."

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