County buys Volvo plant. County sells Volvo plant to Linamar Group, a Canadian manufacturer, the following year. Asheville gives Linamar $2.2 million in incentives over four years. Buncombe puts up $6.8 million in incentives. North Carolina pitches in $9 million. The hoped-for results? Almost 400 jobs for the Asheville-Buncombe area that pay, on average, more than $39,000 a year.
State and local officials were jubilant when they announced the news tonight, June 30, at the Asheville Area Chamber of Commerce’s annual dinner: Linamar would take over the old Volvo plant, recently purchased for $7 million by Buncombe County, and provide 363 jobs and $80 million in capital investment, with the possibility of more to come. The average job will pay $39,752 with benefits.
“This company could have gone anywhere in the world. They chose Asheville,” Gov. Bev Perdue told the audience of local business owners. She asserted the combination of incentives, infrastructure and education secured the deal.
“This project didn’t happen because there was a jobs fairy that flew over Asheville and sprinkled some dust down and said ‘you all deserve this,’” Perdue said. “It doesn’t work that way when 49 other states are competing for the same jobs.”
Linamar will hold a job fair at the Haynes Building on AB-Tech’s Enka campus from 12 p.m. to 8 p.m. on Tuesday, July 5, and 9 a.m. to 5 p.m. on Wednesday, July 6. Renovation begins in August, and production in November. The company aims to have full production going by late 2013.
The deal’s origins stretch back to late last year, when local officials, led by Buncombe Commissioner K. Ray Bailey, current chair of the local Economic Development Coalition, began brokering an agreement with Linamar. Last December, the governor called Volvo to convince them to lower the selling price of their former plant in order to facilitate the deal. City officials were also involved in the negotiations, with Mayor Terry Bellamy taking company executives on a tour of the old plant. Several weeks ago, Linamar CEO Linda Hasenfratz visited the area and met with the governor.
“This was a long journey for us, it took a long time to decide on this, but the support was incredible at all levels: We couldn’t say no,” Nick Adams, the company’s vice president for global sales, said. “We’re not moving work here, we’re starting growth. Nobody’s losing their job somewhere else.”
Adams also praised the area’s community college system as one of the best the company has seen, and he said it will pursue apprenticeship and internship programs with AB-Tech.
Ironically, one of the Asheville plant’s first clients will be Volvo, the former occupant.
The city will pay its share of the incentives via tax rebates, while Buncombe will pull from an economic development fund for its share. The state’s $9 million will consist of a combination of grants and tax rebates. Board of Commissioners’ Chair David Gantt told Xpress that additional jobs are a strong possibility given Linamar’s record of growth.
City and county officials promised that the incentives are dependent upon Linamar meeting investment and payroll benchmarks.
According to Linamar executives, the county’s role in securing the building was vital, allowing them to gather additional capital to make the renovation possible. As part of the deal, Linamar will buy the building from the county in early 2012, allowing the county to recoup the money it spent on the sale.
Gantt claimed that for every job Linamar brings to the area, it will create another three indirectly.
“We didn’t get the memo that said manufacturing is dead in the United States!” he exclaimed, praising his colleagues’ “political guts” in choosing to buy the Volvo plant.
Bellamy, who donned a Linamar cap for her speech, pledged the company “the full support of the city, the strength of our world-class workforce and the innovative and independent spirt of our residents.”
The commissioners will discuss the deal in more detail at their July 26 meeting. Asheville City Council will vote on the city’s portion of the incentive package at an upcoming meeting.
Photos and Twitter dispatches from the announcement below.
— David Forbes, senior news reporter; Jake Frankel, staff reporter; Margaret Williams, news editor
Photos by Jonathan Welch