May 11, 2007

That's big.

Mobile County wins ThyssenKrupp plant

ThyssenKrupp AG has chosen north Mobile County as the site for what was billed as a $2.9 billion steel mill, according to Neal Wade, head of the Alabama Development Office.

The company's board of supervisors made the decision today in Dusseldorf.

The Alabama site, which is near Mt. Vernon and on the Tombigbee River, was chosen over a site along the Mississippi River near Convent, La.

ThyssenKrupp has said the mill will mean 29,000 jobs during construction, and 2,700 jobs paying an average of $50,000 to $65,000 annually once the plant is operational in 2010.

The mill would produce high-grade carbon steel and stainless steel for sale primarily into the North American automotive industry. [...]

In making the announcement, the company also indicated that it planned to enlarge the scope of the project, making its investment in the Alabama mill closer to $3.7 billion.

"Higher capacities and extended plant configurations were shown to be feasible and economic," the company said. "Beyond the original model, ThyssenKrupp Steel will install additional equipment to further diversify its product portfolio." [...]

This process seems like it's been going on forever, but persistence pays off. As I mentioned last week sometime, I noted that the press seems to take any economic news and make it seem bad, the example being all the jabbering about the "weak" dollar versus the euro, but this is just one example of the benefit of this type of exchange rate--a strong dollar would mean that ThyssenKrupp would be less likely to pursue a plant in the US.

There is a lot to industrial development deals such as this, and there's always the charge of paying out corporate "welfare." But as with Mercedes, Honda, Hyundai, state incentives have worked well as an investment, with the companies continuing to grow and expand and add payroll even without additional state help. And again, it's not the only thing that helps lure these companies--there are things such as the political climate, availability of multimodal transportation (truck, air, water, rail--all of which South Alabama provides in spades), natural resources, proximity to customers (again, this plant is meant to serve the automotive industry), quality of life, and simple salesmanship. The Alabama Development Office has done a tremendous job in getting this information to potential clients, and more importantly, acting in a way that shows companies that Alabama is serious and wants investment.

In the end, no matter what you think of the way the game is played, we've managed to play it to our benefit, and to the benefit of the companies which do business here.

Posted by Terry Oglesby at May 11, 2007 08:20 AM

Let's not forget the supply of prime (#2 next to NC!) barbecue, as well as the proximity to the Redneck Riviera.

B-ham does have a nice central location between places like Atlanta, Nashville, Memphis, New Orleans, Mobile and even Tampa/Orlando. For commodities transported over the road and rail, central locations make business sense.

Posted by: Marc V at May 11, 2007 08:53 AM

Hi Terry,

We will be driving thorough the extreme SW corner of

Alabama en route to Florida in June. The problem I am

having is FL, LA, MS, & TX provide easy access to

online highway maps but I am NOT having any luck

finding ALABAMA highway maps online???

Do you have any marsupial links that you can share??

Pace your self this weekend.


Sine Nomine

Posted by: Sine Nomine at May 11, 2007 09:34 AM

Careful, Marc--you don't want to get the barbecue war started up again! It is a good spot, although the one thing working against it is the potential for hurricanes, although the Louisiana site was similarly situated. I would hope this is taken into account in the plant design.

AND Sine Nomine, you could try have an online highway map of Alabama that should be pretty helpful.

Posted by: Terry Oglesby at May 11, 2007 09:56 AM

Thanks But it seems to be circa 2005 &

I wanted something newer if possible.

Thanks again

Sine Nomine

Posted by: Sine Nomine at May 11, 2007 10:18 AM

Well, there's this map from the Alabama Department of Tourism. It's copyright 2007.

Posted by: Terry Oglesby at May 11, 2007 10:28 AM

So, are the nice Thyssen Krupp people going to be melting steel with fire? Because that can't be done, so I'm thinking this is an awful lot of time and money to spend on something that can't possibly work.

Posted by: Carol at May 11, 2007 02:23 PM


Carol, you get a gold star for that one!

Posted by: Terry Oglesby at May 11, 2007 02:55 PM