By Jack Rogers
From the January/February 2018 Issue
South Carolina is Business Facilities’ 2017 State of the Year. The Palmetto State took BF’s top honor by doubling down on its solid manufacturing base while diversifying into new growth sectors. Massive new commitments from auto giants BMW and Volvo were the drivers in a bounty of new projects in South Carolina in 2017, the top five netting 6,400 new jobs for the state.
“The Volvo and BMW expansions catapult South Carolina into the top tier of U.S. automotive manufacturing hubs, but the Palmetto State also has been busy laying the foundation for sustainable growth across a diversified portfolio of growth sectors,” said BF Editor in Chief Jack Rogers.
Volvo Cars is investing $520 million in its operations center in Berkeley County, SC, creating 1,910 jobs at a new manufacturing plant that will be the global production site for Volvo’s all-new S60 sedan. The plant is expected to produce the next-generation XC90 in 2021. Volvo also is building an 88,000-square-foot facility at its Berkeley County complex that will serve as a training center and house R&D activities. Volvo’s total investment in its South Carolina production hub, which includes the automaker’s first North American manufacturing facility, now exceeds $1 billion.
BMW is investing $600 million to expand its Greer, SC plant, creating 1,000 new jobs over the next four years; the Greer facility straddles the border of Spartanburg and Greenville counties. The 2017 announcement coincided with the German automaker’s 25th anniversary of manufacturing in the Palmetto State, an investment totaling more than $8 billion. The 2018 BMW X3, a compact sports vehicle, is being produced in Greer alongside the BMW X4, X5 and X6 models.
The huge investments by Volvo and BMW in South Carolina were accompanied by a surge in new projects from automotive suppliers in the Palmetto State.
In June, Magna International opened a new $29-million, 230,000-square-foot plant that will manufacture seats for BMW X model vehicles produced at the German automaker’s Greer plant. The facility is on a 20-acre site at Pacolet Milliken’s Tyger Industrial Park North in Spartanburg County. Canada-based Magna says the plant expects to employ up to 480 workers by 2020.
In December, Bosch Group announced a $152-million expansion of its Anderson County production lines for automotive electronic components. The expansion will create 130 new jobs.
SAMSUNG PICKS NEWBERRY COUNTY
Newberry County, SC scored one of 2017’s most-coveted economic development projects when it secured Samsung Electronics America’s new $380-million home appliance plant. The manufacturing and R&D operation, which is occupying a former Caterpillar plant, is expected to create 954 new jobs by 2020.
“When Caterpillar closed two SC plants in 2016, the state didn’t waste any time wringing its hands over the loss. Instead, it quickly lined up a worthy successor that will support twice as many jobs,” Rogers noted. “This can-do, proactive approach is a model that other states would be wise to emulate. South Carolina has proven it can punch well above its weight and hold its own with its larger neighbors.”
“We aspire to be the global leader in premium home appliances,” said Samsung Electronics CEO B.K. Yoon. “This new investment will enable Samsung to increase the speed with which we can deliver premium home appliances that reflect the regional preferences of our fastest growing and most important consumer market.”
Samsung began contemplating an expansion of its U.S. production base nearly three years ago and initiated discussions with South Carolina in the fall of 2016. The company ultimately selected the Newberry County site for its high-skilled workforce, robust supply chain and transportation infrastructure and commitment to public-private partnerships.
“The fact that one of the world’s largest and most respected technology companies is choosing to invest in South Carolina speaks volumes about the innovation and excellence our talented workforce is capable of,” said SC Gov. Henry McMaster. “I’m thrilled to strengthen our state’s partnership with Samsung and look forward to working with them to get this new facility up and running, and producing high quality made-in-South Carolina products.”
[At press time, state officials in SC were assessing the impact of the Trump Administration’s January announcement that it is imposing large tariffs on Samsung refrigerators and washing machines imported from South Korea. The tariff decision came about a week after the Newberry plant began production with over 600 employees.
Trade Representative Robert Lighthizer announced Trump agreed with his office’s recommendations to put tariffs up to 20 percent on large residential washing machines imported by the South Korean company. Gov. McMaster had opposed the new tariffs. “We were unable to convince the people in Washington that there should not be a tariff placed on the next three years on the washing machines that they are bringing in while they’re starting production in Newberry,” McMaster told state business leaders with the South Carolina Chamber of Commerce.
“I thought it was a bad decision,” the governor added.]
CompuCom, a Texas-based info tech player, is building its new global headquarters in Lancaster County, SC, a $41-million investment that will bring 1,500 new jobs to the state. The 150,000-square-foot CompuCom HQ will help anchor the Bailes Ridge Business Center, a corporate park that is spurring development upstate in a rapidly growing area known as Indian Land.
South Carolina put down a marker that it intends to be a major player in the highly competitive medical devices market when it convinced Arthrex to launch new manufacturing operations in Sandy Springs, SC, a $69-million investment that will create more than 1,000 new jobs in Anderson County. Arthrex, based in Naples, FL, will use the new 200,000-square-foot facility to manufacture its innovative orthopedic devices and implants.
“Arthrex joins a burgeoning roster of life sciences firms that have decided to call South Carolina home,” Rogers said. “SC is becoming a top choice for new facilities in this critical growth sector. The Palmetto State is wisely spreading the wealth with its impressive strategy to revitalize the Anderson County region.”
Another major manufacturing project for SC came from one of the world’s largest tool and storage companies, Stanley Black & Decker. The hardware giant will open a new manufacturing facility in York County, SC. The new operations are projected to bring $31 million in capital investment and lead to the creation of 500 new jobs. Stanley Black & Decker will be occupying a new 345,000-square-foot facility for the manufacture and assembly of DEWALT cordless power tools. The new facility will be located in the Lakemont Business Park in Fort Mill, SC.
PORT OF CHARLESTON: READY TO COMPETE FOR THE BIG SHIPS
Since the reopening of the expanded Panama Canal in 2016, the Port of Charleston has aggressively positioned itself to be a primary beneficiary of increased shipping from the huge Post-Panamax container vessels that now are able to travel directly from Asia to the East Coast through the Canal’s new locks. In June 2017, the Port of Charleston welcomed the largest container ship to visit the East Coast, the OOCL France, capable of carrying nearly 14,000 cargo containers.
South Carolina’s Ports Authority is spending more than $1.5 billion on infrastructure improvements to keep the big ships coming to Charleston. This includes a $530-million project to deepen Charleston Harbor to 52 feet, making it the deepest navigation channel on the East Coast and allowing Post-Panamax to enter without tide restrictions. The dredging project will be completed next year when a new container terminal opens on the former Navy Base in North Charleston.
“The Port of Charleston is the crown jewel of a thriving logistics network that makes South Carolina a prime location for new distribution and fulfillment centers,” Rogers said. One example is LuLaRoe, a California-based apparel producer that sells its clothing through more than 80,000 retailers nationwide. The company decided in 2017 to invest $35 million in a new distribution center in Columbia, SC, a project expected generate 1,000 new jobs.
With Boeing manufacturing advanced aircraft components in North Charleston for the past decade (including the assembly line for the 787-10 Dreamliner), South Carolina already had a solid foothold in the advanced materials sector when Japan’s Teijin Ltd. announced last year the creation of Teijin Carbon Fibers, which will make precursors for carbon fiber in a new production facility in Greenville, SC as part of a $600-million global expansion.
In November, WestRock Co., a leading provider of differentiated paper and packaging solutions, announced it would make a $410-million investment in its Florence, SC kraft linerboard mill that will significantly increase the mill’s efficiency, quality and service levels.
The expansion, which will take two years to complete, will include installing a 330-in. kraft linerboard machine and related infrastructure that will replace three older, narrow-width paper machines. The company expects the new machine to produce 710,000 tons of kraft linerboard annually. In addition, the company plans to invest approximately $60 million over the next five years to support the new machine and other mill projects. When coupled with the recently completed modern woodyard, the Florence mill will become one of the lowest-cost kraft linerboard mills in North America.
“This investment will make our Florence mill a state-of-the-art manufacturing facility, sustaining good manufacturing jobs and promoting the long-term success of the mill,” said Steve Voorhees, chief executive officer of WestRock. “The support of the Florence County Economic Development Partnership and the South Carolina Department of Commerce helped make this investment possible and is greatly appreciated.”
SOLAR ENERGY GROWS IN SOUTH CAROLINA
According to SC Secretary of Commerce Bobby Hitt, the growing renewable energy market in South Carolina is “revolutionizing” the state’s economy.
In December, Cypress Creek Renewables, a company that specializes in the ownership and development of long-term solar energy projects, announced a new $115-million solar project in Orangeburg County. The new 75-megawatt facility is expected to be placed into service by 2019.
Cypress Creek Renewables has an established track record of developing and constructing solar projects throughout South Carolina.
“Any time a company invests in South Carolina, it’s a sign of the state’s strong economy. But when a company from a new and innovative industry like solar decides to do business here, it shows that we have the tools in place to maintain and grow our economy in the long run. We’re grateful for Cypress Creek Renewables’ continued investment in South Carolina, and we’re excited for what the future holds for this partnership,” Gov. McMaster said.
Befitting a state that is bathed in sunshine for most of the year, South Carolina has some of the most generous solar incentives and rebates in the U.S. The Palmetto State is encouraging residents to go solar by enabling them to save thousands of dollars on their solar panel installation costs.
South Carolina residents can claim 25 percent of their solar costs as a tax credit (and if these residents don’t pay enough in taxes to get the full value of the credit in one year, it carries over for up to 10 years).
Utilities serving SC are pitching in with additional incentives, like letting customers earn payments for every kilowatt-hour (kWh) of electricity that your solar panels generate. Here are some examples:
- Duke Energy Progress: customers can get a $1.00 rebate for every watt of solar power they install on their home or business. For an average 6-kilowatt (kW) system, that’s an extra $6,000 to help cover the cost of going solar.
- Santee Cooper: customers are eligible for a rebate of $1.30/W of solar energy that they install on their roofs, up to $5,200.
- South Carolina Electric & Gas has a payment program that “steps down,” or reduces in value, as more solar power is installed in the state. Depending on how quickly customers install their solar panels, they are eligible for a payment of anywhere from $0.01 – $0.04 per kWh of energy these panels produce.
As of mid-2017, the average price for solar panels in Columbia, SC was $3.27 per watt. Thus, since the typical system size in the U.S. is 5 kilowatts (5,000 watts), the average cost of a solar panel system in Columbia is $16,350 before any rebates or incentives.