More to come, but I just caught news that a Caterpillar motor grader production plan is slated for the vacant video plant in North Little Rock.
Not long ago, Caterpillar (which has had contentious relationships with a union representing assembly employees) announced layoffs elsewhere in the company.
Big jobs for Arkansas, about 600 of them.
Caterpillar talked about a new motor grader plant back in June, but an existing facility in Illinois was mentioned then as a front-runner. The back story ought to be interesting on the final location. Jobs were cut in Decatur last month. There has been nervousness there, the local newspaper reports, about loss of motor grader jobs, said to be part of an increase in production of larger mining machines in Decatur.
UPDATE: Jon Harrison, who spoke on behalf of Caterpillar, said one of the deciding factors in bringing the plant to North Little Rock was Arkansas’ “friendly business climate.” Part of what made the business climate so friendly was no doubt the incentives package given to the company. The state gave CAT $3 million from the governor’s quick-action closing fund which will be used to develop a test track, an outside storage area and an entrance road. The state also offered training assistance for new hires and three performance-based incentives including:
Tax Back – provides a sales tax refund on eligible construction materials.
Advantage Arkansas – provides income tax credits based on payroll of new employees (credit earned each tax year for a period of five years).
Create Rebate – provides a cash rebate equal to five percent of payroll for 10 years.
During the press conference, neither Harrison nor Gov. Beebe went into more detail on exactly why NLR was chosen over other possible locations.
UPDATE UPDATE: Arkansas Business sheds more light on city (not state) incentives to Caterpillar including reduced electricity bills, a new power substation, a water treatment facility, the waiver of building permit fees and carbon offsets. -- GPM.
NORTH LITTLE ROCK, Arkansas (January 5, 2009) – Caterpillar, the world’s largest manufacturer of construction and mining equipment, today announced plans to locate its new North American motor grader production facility in North Little Rock, Arkansas. The company is locating in the former Deluxe Video building, where it will invest $140 million and employ approximately 600 people. Production of commercial motor graders is expected to begin in early 2010.
“Welcoming a well-known and respected company like Caterpillar to Arkansas is a great way to start 2009,” Governor Mike Beebe said. “We look forward to a long and successful partnership with Caterpillar that will serve as another example of the advantages Arkansas has to offer to companies increasing their presence throughout the world.”
A full line of motor graders, with the exception of the 24M motor grader, which is used primarily for mining applications, will be manufactured at the North Little Rock facility. For decades, Caterpillar customers have used these motor graders to build and maintain roads, highways, airports and other construction projects on every continent.
“Relying on the Caterpillar’s foundational values, and the Caterpillar Production System with 6 Sigma discipline, the North Little Rock facility will be a benchmark for manufacturing productivity, quality and safety,” said Jon Harrison, General Manager of North American Motor Grader Operations for Caterpillar, and the North Little Rock facility. “Moving motor grader production to North Little Rock is part of Caterpillar’s long-term, strategic plan to increase its large mining truck capacity in Decatur, Illinois and drive greater focus on improving motor grader production.”
“For North Little Rock, central Arkansas, and the state, the benefits of being the home of an internationally known Caterpillar product are many and huge,” said North Little Rock Mayor Patrick Hays. “This decision is an announcement to the world that we are a major factor in the vehicle manufacturing industry.”
Hays said the efforts to bring Caterpillar to North Little Rock involved the cooperation of local and state governments, as well as the North Little Rock Economic Development Corporation, the Metro Little Rock Alliance, and the chambers of commerce of North Little Rock and Little Rock.
“Our successful team effort provides a textbook example of how important both regional and intergovernmental cooperation are to a winning economic development strategy,” said Hays.
Headquartered in Peoria, Illinois, Caterpillar is a global operation with more than 400 locations in 50 countries. The company has more than 500 products sold worldwide, with sales totaling $44.9 billion in 2007.
Those interested in employment at the Caterpillar facility can apply online at www.cat.com/careers. Hiring will begin in mid-2009.