Posted by Heidi Schwartz
Kentucky Gov. Steve Beshear has announced a joint venture between Constellium N.V. and UACJ Corporation to build an aluminum production facility in Bowling Green. The $150-million project is one of the largest in south central Kentucky in the past decade and is expected to create 80 new jobs.
The joint venture will produce finished aluminum body sheets for cars and trucks. The company will supply these parts to the country’s major automotive manufacturers.
“This is a huge investment in Kentucky – one that further solidifies our role as a key player in the auto industry,” said Gov. Beshear. “It’s also exciting to see companies from two different continents jointly choose Kentucky as the place to manufacture an innovative product. I want to thank both Constellium and UACJ for putting more Kentuckians back to work, and I look forward to seeing this partnership’s impact on vehicles around the world.”
Constellium, a European aluminum company, and UACJ, a Japanese aluminum company, both will supply the aluminum coils that will then be treated and processed in Bowling Green. The joint venture is subject to regulatory approval.
The companies chose Bowling Green for many reasons, including its location to customers and highly skilled workforce. Construction on a 225,000-square-foot facility at the Kentucky Transpark is expected to start this summer. The facility is also designed to allow for future expansion.
“Bowling Green is the right place for this plant, particularly because its central location will allow us to serve automotive OEMs across the U.S. with our advanced and innovative range of products,” said Laurent Musy, president of Constellium’s Packaging and Automotive Rolled Products business unit. “The availability of a highly skilled local labor force and the entrepreneurial spirit of the area were the decisive factors in choosing the city of Bowling Green and the state of Kentucky, which have been very supportive during the decision process.”
“This project is very significant for UACJ in terms of our Body-in-White market strategy,” said Mitsuru Okada, CEO of UACJ. “We look forward to supplying automotive OEMs throughout the U.S. with advanced products utilizing the technologies each party has separately developed in Europe and Japan. We welcome this joint venture with Constellium to tackle the strategic automotive market in the U.S. Both companies have been working hard together in the spirit of equal partnership, allowing us to finalize the agreement in a timely and efficient manner.”
Tri-Arrows Aluminum will be one of the key suppliers of cold rolled aluminum coils to the new partnership. Tri-Arrows Aluminum, which is headquartered in Louisville, is a subsidiary of UACJ. The company manufactures its base aluminum coils at its joint-venture operating mill at Logan Aluminum Inc., located in Russellville. Logan is one of south central Kentucky’s largest employers with more than 1,000 full-time employees.
”This is a great opportunity for UACJ and Tri-Arrows to participate in this dynamic growth segment for aluminum along with our partners at Constellium,” said Patrick Franc, president and CEO of Tri-Arrows Aluminum Inc. “We are also very pleased with the choice of Bowling Green, which is in close proximity to the Logan rolling mill.”
The demand for aluminum sheets is growing as more automotive manufacturers are switching to aluminum from steel. Aluminum allows vehicles to be lighter, which helps manufacturers comply with new federal fuel standards.
“Bowling Green continues to grow as a major industrial hub in Kentucky, attracting major companies who want to call our wonderful city their home,” said Sen. Mike Wilson, of Bowling Green. “Our vibrant community offers manufacturers not just a great location, but a workforce that is second to none.”
“This investment is great news for Warren County and the surrounding region and further confirms to me that there is no better place for companies to locate and expand,” said Rep. Jody Richards, of Bowling Green. “I want to welcome the companies to our community and look forward to working with them in the years ahead. I also want to thank our state and local economic development officials for helping to make all of this possible.”
“The leadership and collaboration in Bowling Green, Warren County and the state of Kentucky continues to propel our community forward, and it is an honor to be part of such impressive economic growth,” said Warren County Judge-Executive Michael Buchanon.
To encourage the investment and job growth in Warren County, the Kentucky Economic Development Finance Authority (KEDFA) preliminarily approved the company for tax incentives up to $4.5 million through the Kentucky Business Investment program. The performance-based incentive allows a company to keep a portion of its investment over the term of the agreement through corporate income tax credits and wage assessments by meeting job and investment targets.
KEDFA also approved the company for tax benefits up to $1.5 million through the Kentucky Enterprise Initiative Act, which allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing equipment.
The announcement is another win for Kentucky’s thriving automotive industry. Kentucky ranks third in the U.S. in light vehicle production and first per capita. Since 2010, nearly 300 motor vehicle-related projects have been announced statewide, representing more than 17,600 new jobs and $4 billion in new investment.