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Tuesday, April 25, 2017
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Highly touted reshoring event hits speed bump, says A.T. Kearney. Really?

Chinese investment surfacing in the South? Yes, finally.

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A success story from the Mississippi River Delta

The 50-year economic development war in the U.S. is over; the South won.

The big dogs are about to eat: Soon, the automotive industry will light up the Southern Auto Corridor again 

Kentucky: The Spirit of the South

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Aerospace Industry Takes Off in the American South

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Petrochemicals and the Southern Manufacturing Renaissance

Non-Petrochemicals and the Southern Manufacturing Renaissance

Ten Reasons Why Manufacturing is Booming in The South

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Reshoring and its potential effect on the Mississippi River Delta region

  
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Non-Petrochemicals and the Southern Manufacturing Renaissance

How does the manufacturing movement look in the South if you take petrochemicals out of the equation?

By Mike Randle

Everyone knows by now that manufacturing is the hottest aspect of an improving U.S. economy. Since the end of the recession, manufacturing production has increased by 30 percent, doubling the growth rate of the economy as a whole. The four-year run is the longest period "manufacturing has outpaced U.S. economic output since 1965," according to a recent report by the U.S. National Economic Council.

Houston was recently named by Forbes as the best city in America for manufacturing. Leading the manufacturing parade in the Houston region are $35 billion in planned refineries that will be under construction next year. But it's not just Houston that is thriving on the manufacturing front. Throughout oil-rich Southern states, manufacturing is building a beachhead like no time in decades.

The Lake Charles, La., region, Baton Rouge, New Orleans, Lafayette, Corpus Christi, Dallas-Fort Worth, Odessa, Midland, San Antonio, Oklahoma City and Tulsa, just to name a few, are experiencing a rebirth in the manufacturing sector that is significant to each of their economies. And almost all of the gains in those markets are coming from announced, pending or current petrochemical projects that represent more than $125 billion in investments. (see article on petrochemicals that follows this one).

But manufacturing is booming all over the South. June saw the sector grow at its fastest pace in four years. Also listed in their top 10 for large manufacturing metros, Forbes cited Nashville, Louisville, Austin and Birmingham. None of those markets have anything to do with petrochemicals.

In the question and answer portion of a talk I made recently I was asked if the petrochemicals industry in Louisiana and Texas was an important factor in this manufacturing revival the American South is experiencing. My answer was, "Are you kidding, man?"

It's certainly obvious the petrochemicals industry is the primary driver in the manufacturing revolution the South is seeing today. Reshoring, make it where you sell it, nearshoring and onshoring are the other primary drivers in this five-year manufacturing wave that has washed onto the South's shores as well. It is really a perfect economic storm, where the planets and the stars are aligned like no time we have ever seen. 

Yet, if you take the oil and gas and chemical sectors out of the equation, what other manufacturing industries are thriving in the South and where are the game-changing non-petrochemical plants going? It's a good question, one that needs to be addressed if we are to truly understand this rare but welcomed manufacturing revolution.

So where is this manufacturing revolution occurring in the South that is not petrochemicals-based? Well, start with the No. 1 industry in the region based on projects announced over the past 20 years and that's the automotive industry. The auto industry is a mile wide and a mile deep in the South. Every state in the Southern Auto Corridor benefits from its investments, even those that are not home to original equipment manufacturers.

In our annual assessment of industry sector performances, we split oil and gas and chemicals in the ranks. They are certainly interrelated, but chart No. 1 shows that petrochemicals combined are the No. 1 manufacturing sector in the South since the region's economy got big-time legs in 2010. But when oil and gas and chemicals are separated, automotive rules.

Chart No. 1

Top Manufacturing Sectors 2010-2014*

1. Petrochemicals
a. Oil & Gas
b. Chemicals
2. Automotive
3. Food & Beverage
4. General Manufacturing
5. Aviation & Aerospace
6. Building Materials
7. Electronics
8. Metals
9. Furniture
10. Apparel

398
226
172
306
163
121
96
90
70
51
23
21

* Number of manufacturing projects announced in the South meeting or exceeding 200 jobs and/or $30 million in investment in the top 10 industry sectors from Jan. 1, 2010 to June 30, 2014. Source: SB&D

Greenville-Spartanburg, S.C., leads all markets in the South with 19 non-petrochemical projects making the SB&D 100s from 2010 to 2014. Pictured is the biggest manufacturing draw in the Upstate, the BMW plant in Greer, S.C.

Chart No. 2

Game-Changers
Top Non-Petrochemical Manufacturing Locations SB&D 100 2010-2014

1. Greenville-Spartanburg, S.C.
2. Dallas-Fort Worth, Texas
3. Nashville, Tenn.
4. Louisville, Ky.
5. Baton Rouge, La.
6. Charlotte, N.C.
7. Mobile, Ala.
8. Columbia, S.C.
9. Memphis, Tenn.
10. Charleston, S.C.
11. St. Louis, Mo.
12. Tuscaloosa Co., Ala.
13. Austin, Texas
14. Guilford Co., N.C.
15. Montgomery, Ala.
16. San Antonio, Texas
17. Winston-Salem, N.C.

19
12
11
10
7
7
7
6
6
5
5
5
4
4
4
4
4

* There are 19 additional cities with 3 non-petrochemical projects that made the SB&D 100 2010-2014.

Automotive

The automotive sector has been so active over the past four and a half years, giving you samples of its growth is not a problem. OEM and supplier expansions, as well as new supplier projects, are announced every week. One of the automotive supply sectors that has really grown is the manufacture of tires by foreign-owned companies in the region. Several Southern states have captured significant projects in tire manufacturing.

South Carolina particularly stands out. In the fourth quarter of 2013, the Palmetto State became the nation's largest tire-making state, producing 89,000 tires a day. That beat Oklahoma's production of 88,000 tires a day. So the South is home to the top two tire-making states. South Carolina is also exporting more tires than any other state, accounting for 30 percent of the nation's overseas market.

Singapore-based Giti Tires' announcement in the summer that it will build a $560 million, 1,700-employee plant in Chester, S.C., brings investments made by tire manufacturers to $3.5 billion in the state since 2011. Those investments will result in the creation of over 5,000 jobs.

Foreign-owned tire plants have dominated the automotive sector in large, new projects in the Southern Automotive Corridor over the past few years. Here is the Yokohama announcement in West Point, Miss., last year.

New and existing tire plant projects in the South 2011-2014:

2011
Company
Bridgestone
Toyo Tires
Continental Tire
Michelin
Location
Aiken, S.C.
Cartersville, Ga.
Sumter, S.C.
Lexington Co., S.C.
$Inv
$1240
$910
$500
$130
Jobs
850
470
1620
220
 
2012
Company
Michelin
Michelin
Location
Anderson Co., S.C.
Lexington Co., S.C.
$Inv
$750
$750
Jobs
500
500
       
2013
Company
Hankook
Yokohama Tire
Kumho Tire
Michelin
Location
Clarksville, Tenn.
West Point, Miss.
Macon, Ga.
Anderson Co., S.C.
$Inv
$800
$300
$225
$200
Jobs
1,800
500
300
100
       
2014
Company
Giti Tires
Location
Chester, S.C.
$Inv
$560
Jobs
1,700

*$INV = investment in millions

Food & Beverage

Food and beverage sectors have surged near the top of the non-petrochemical manufacturing sector. Pictured is the visitor center at the Woodford Reserve distillery near Versailles, Ky. The bourbon industry in Kentucky has never been more popular worldwide.

This sector has expanded substantially in the South post-recession. The food and beverage sector's growth is important since most of the projects are located in rural areas of the South. Here are the highlights from the past year:

2013
Company
Wright Foods 
Unilever
Jack Daniels
Woodford Reserve
Dot Foods
McKee Foods
Royal Cup
Great Lakes Cheese
Williams Sausage
Mars
Monogram Foods
Ozark Mtn. Poultry
Location
Montgomery Co., N.C.
Covington, Tenn.
Lynchburg, Tenn.
Versailles, Ky.
Dyersburg, Tenn.
Collegedale, Tenn.
Birmingham, Ala.
Manchester, Tenn.
Union City, Tenn.
Cleveland, Tenn.
Martinsville, Va.
Rogers, Ark.
$Inv
N/A
$108
$100
$35
$24
N/A
$30
$100
$3
$67
N/A
N/A
Jobs
505
428
90
N/A
157
300
40
200
148
50
100
250
       
2014
Company
Peco Foods
King's Hawaiian
Champion Petfoods
Sazerac
Maker's Mark
Unilever
Diageo
Tyson Foods
Mondelez
Perdue Foods
Location
Northeast Ark.
Oakwood, Ga.
Logan Co., Ky.
Frankfort, Ky.
Loretto, Ky.
Independence, Mo.
Shelby County, Ky.
Goodlettsville, Tenn.
Henrico Co., Va.
Prince George Co., Va.
 
$Inv
$165
N/A
$85
$28
$67
$99
$115
$15
$40
$3
Jobs
1,000
450
147
89
N/A
77
30
157
N/A
190

*$INV = investment in millions

General Manufacturing

This sector includes many different manufacturers from toothpaste to tissue paper to firearms to contact lenses. Here are some of the larger projects from the general manufacturing sector announced in the South in the past two years:

2013
Company
Colgate-Palmolive
First Quality Tissue
Vistakon
Brady Corp.
Ruger
Fritz Industries
Ardagh Group
Ithaca Gun
Schwan Cosmetics
Leisure Pools
Beretta
Kent International 
Colgate-Palmolive
Location
Greenwood, S.C.
Anderson Co., S.C.
Jacksonville, Fla.
Louisville, Ky.
Mayodan, N.C.
Greenville, Texas
Roanoke Co., Va.
Horry Co., S.C.
Murfreesboro, Tenn.
Knoxville, Tenn.
Gallatin, Tenn.
Clarendon Co., S.C.
Morristown, Tenn.

$Inv
$200
N/A
$218
$18
$26
$37
$93
$7
$38
$6|
$45
$4
N/A

Jobs
300
200
100
121
473
250
96
120
250
240
300
175
75
       
2014
Company
Remington
Pharmavite
Caterpillar
EZ Portable
Fibrebond
Acco Brands
Palmetto Armory
Heritage Glass
WS Packaging
Bayshore Products
CAMBRO
Scout Boats
Location
Huntsville, Ala.
Opelika, Ala.
Bogart, Ga.
McCracken Co., Ky.
Minden, La.
Booneville, Miss.
Lexington, S.C.
Kingsport, Tenn.
Knoxville, Tenn.
Northampton Co., Va.
Alamance, Co., N.C.
Dorchester, Co., S.C.

$Inv
$110
$22
N/A
$1
$2
$2
$4
$16
$43
$4
N/A
$3

Jobs
2,000
50
200
90
225
162
300
300
231
135
100
300

*$INV = investment in millions

Aviation & Aerospace

Aerospace is following the automotive industry to the South with one project after another and most states are seeing plenty of activity.

This industry is about to take off. Airbus is building its full assembly facility in Mobile, Ala., that will be finished next year and Boeing is into its third year of 787 assembly in North Charleston, S.C. But that's just the commercial jetliner sector — two of just three full assembly commercial jet facilities in the U.S. Aerospace, like automotive, greatly affects the economies of almost every state in the South. Look for this industry to grow as fast as any in the next few years. (In October, SB&D is publishing a bonus issue on aerospace in the South.)

2013
Company
Boeing
Dassault Falcon
MidAir S.A.
Northrop Grumman
GE Aviation
LMI Aerospace
AAR
GE Aviation
Boeing
Boeing
Embraer
Aveo Engineering
Kilgour Industries
Gulfstream  
Location
N. Charleston, S.C.
Little Rock, Ark.
Melbourne, Fla.
St. Johns Co., Fla.
Asheville, N.C.
Savannah, Ga.
Lake Charles, La.
Durham, N.C.
Huntsville, Ala.
St. Louis, Mo.
Melbourne, Fla.
Flagler Co., Fla.
Henry Co., Va.
Brunswick, Ga.

$Inv
N/A
$60
$28
N/A
$195
N/A
N/A
$80
$6
N/A
$28
$7
$27
$25

Jobs
200
120
300
400
340
100
500
120
400
200
600
300
155
100
       
2014
Company
Boeing
Gulfstream
Orbital Outfitters
Southern Aviation
Bell Helicopter
Northrop Grumman
Raytheon
GE Aviation
Aviation Technical
Mooney
Northrop Grumman
Lockheed Martin
Lockheed Martin
Pacific Rim Aerospace
SWG Aerospace
BizJet
Toray
Location
N. Charleston, S.C.
Savannah, Ga.
Midland, Texas
Chatham Co., Ga.
Lafayette, La.
Lake Charles, La.
Forest, Miss.
Ellisville, Miss.
Kansas City, Mo.
Kerrville, Texas
Melbourne, Fla.
Orlando, Fla.
Marietta, Ga.
Charleston Co., S.C.
Mocksville, S.C.
Tulsa, Okla.
Spartanburg Co., S.C.

$Inv
N/A
N/A
$7
$17
$11
N/A
N/A
N/A
$7
N/A
$500
N/A
N/A
N/A
N/A
N/A
$1000

Jobs
1,000
300
N/A
200
115
80
150
250
600
100
1,800
200
700
100
50
60
500

*$INV = investment in millions

Building Materials

Dalton, Ga., one of the hardest-hit markets during the recession and the "flooring capital of the world," is making a huge comeback.

This category, which essentially includes anything that is used to build and finish both residential and commercial structures, was slammed during the housing crisis. Dalton, Ga., called the "flooring capital of the world," was one of the hardest-hit communities in the South during the recession. This year, however, it was the South's comeback kid as it was named by SB&D as the 2014 "Small Market of the Year" because of some massive job-generating projects in the flooring industry captured in calendar year 2013.

2013
Company
Tarkett
Engineered Floors
Engineered Floors
Natron Wood 
Shaw
CertainTeed 
Mohawk Industries
Mohawk Industries
Caesarstone
CertainTeed
Weyerhaeuser
Location
Florence, Ala.
Whitfield Co., Ga.
Murray Co., Ga.
Louisville, Miss.
Adairsville, Ga.
Jonesburg, Mo.
Dalton, Ga.
Rome, Ga.
Savannah, Ga.
Meridian, Miss.
Evergreen, Ala.

$Inv
N/A
$200
$250
$10
$85
$100
$45
$40
$100
$24
N/A

Jobs
150
1,000
1,400
200
175
100
220
200
180
100
100
       
2014
Company
Lumber Liquidators
IVC Group
GAF Roofing
Heritage Glass
Dal-Tile
Royal Products
Prime-Line
Zeyuan Flooring
Location
Henrico Co., Va.
Dalton, Ga.
Moberly, Mo.
Kingsport, Tenn.
Dickson Co., Tenn.
Dyer Co., Tenn.
Malvern, Ark.
Danville, Va.

$Inv
$60
$80
$149
$16
$180
$24
$7
$15

Jobs
250
200
125
300
320
85
50
100

*$INV = investment in millions

Electronics

During the 1990s, economic development agencies in the South were focused like a laser on the recruitment of this sector, which back then was centered on the semiconductor industry. There has been some activity in semiconductors over the years, but not much recently. Instead, the electronics industry is a hodgepodge sector with all kinds of things manufactured in the South.

2013
Company
Gazelle
GE
CompuCom
Google
MTD
Nexolon America
Flextronics
Canon Virginia
GE
Certicell
Tecumseh
Whirlpool
Element Electronics
Global Green Lighting
Surface Igniter
Texas Instruments

Location
Louisville, Ky.
Louisville, Ky.
Louisville, Ky.
Caldwell Co., N.C.
Martin, Tenn.
San Antonio, Texas
Fort Worth, Texas
Newport News, Va.
Clearwater, Fla.
Louisville, Ky.
Tupelo, Miss.
Tulsa, Okla.
Fairfield Co., S.C.
Chattanooga, Tenn.
Blount Co., Tenn.
Fort Bend, Texas

$Inv
$22
$100
N/A
$600
N/A
$100
N/A
$27
N/A
$2
$10
$19
$7
N/A
$4
$35

Jobs
438
200
100
N/A
225
400
1,800
N/A
200
90
150
150
500
200
108
375
       
2014
Company
Dewalt
Greenheck Fan
Flextronics
Lockheed Martin
GE
Whirlpool
Enovate Medical
Fresenius Medical
Microsoft
E&I Engineering
Electrolux
Location
York Co., S.C.
Cleveland Co., N.C.
Austin, Texas
Orlando, Fla.
Louisville, Ky.
Greenville, S.C. 
Murfreesboro, Tenn.
Knoxville, Tenn.
San Antonio, Texas
Anderson Co., S.C.
Anderson Co., S.C.
 

$Inv
N/A
$33
$15
N/A
$325
$40
N/A
$140
$250
$17
$30

Jobs
250
184
300
200
N/A
400
410
665
N/A
250
N/A

*$INV = investment in millions

Metals

The natural gas boom in the region has certainly sparked a round of new plants in the metals sector. The expansion of the automotive and aerospace industries in the Southern Auto and Aerospace corridors has also supported growth in the metals sector in the past year. Here are some examples:

2013
Company
Big River Steel
Bilstein Group
Enersteel
G&G Steel
IT-TRI
Southwire
Nucor
Alcoa
Dayton Rogers
Carpenter
 

Location
Mississippi Co., Ark.
Bowling Green, Ky.
Natchez, Miss.
Iuka, Miss.
Trinity, Ala.
Carroll Co., Ga.
Convent, La.
Alcoa, Tenn.
Richland Co., S.C.
Tanner, Ala.

$Inv
$1100
$120
$10
$5
$68
$95
$750
$275
$11
$518

Jobs
500
90
45
35
100
375
1,250
200
134
200
       
2014
Company
Horizon Steel
GD Copper USA
Constellium UACJ
Location
Bowling Green, Ky.
Pine Hill, Ala.
Bowling Green, Ky.

$Inv
$15
$100
$150

Jobs
30
300
80

*$INV = investment in millions

Furniture

The reshoring age is bringing with it some not-so-advanced industries. Furniture manufacturing, which was left for dead more than a decade ago, is returning back to the rural South from Asia. Most of the projects are returning to the traditional furniture manufacturing regions of Mississippi, North Carolina, Tennessee and Southwest Virginia. Here are a few examples:

2013
Company
Rooms to Go
Oddello Industries
HSM
Jackson Furniture
Jackson Furniture

Location
Harnett Co., N.C.
Morristown, Tenn.
Catawba Co., N.C.
Myrtle, Miss.
Mantachie, Miss.

$Inv
$45
$4
$3
$1
$1

Jobs
220
228
162
125
125
       
2014
Company
Vinh Long
9to5 Seating 
England Furniture
Delta Furniture
Corsi Group
Location
Morrilton, Ark.
Union City, Tenn.
New Tazewell, Tenn.
Pontotoc, Miss.
Charlotte Co., Va.

$Inv
$5
$39
$17
$1
$5

Jobs
75
510
300
50
110

*$INV = investment in millions

Textiles & Apparel

Industries such as textiles, apparel and furniture manufacturing are seeing a comeback in the region not seen in two decades.

This is another traditional, old-line industry that is coming back from the dead as a result of the reshoring age. Here are some examples of activity from the textiles and apparel sectors:

2013
Company
VF/Wrangler
EP American Footwear
Parkdale Mills
ShriVallabh Pittie
Gulf Coast Spinning
Gildan Yarns
Gildan Yarns
Gildan Yarns
Keer Group
Solid Stone Fabrics

Location
Hackleburg, Ala.
Hazlehurst, Ga.
Rabun Co., Ga.
Screven Co., Ga.
Bunkie, La.
Bladen Co., N.C.
Rowan Co., N.C.
Davie Co., N.C.
Lancaster Co., S.C.
Martinsville, Va.

$Inv
$31
$10
$85
$70
$130
$75
$75
$100
$218
$1

Jobs
200
250
210
250
307
100
100
300
501
16
       
2014
Company
American Textile
Portwest
Green Applications
Footwear Industries
Highland Industries
Location
Tifton, Ga.
Shepherdsville, Ky.
Gordonsville, Va.
Jefferson City, Tenn.
Iredell Co., N.C.
 

$Inv
N/A
$4
$10
N/A
$8

Jobs
200
100
323
109
40

*$INV = investment in millions

  
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