SAE 2001: More Automotive Investment on Tap for Mississippi

DETROIT -- Mississippi officials, which late last year scored a major coup in landing investment from Nissan Motor Co. Ltd. in the form of a new truck assembly plant, say they may not be done yet.

Development authority insiders tell Ward’s they have been approached by another company -- through a third party -- about a possible sizable investment in their state. Officials haven’t been given details of the project, nor do they know the identity of the company involved. But they say that the scope of the investment being talked about indicates the unnamed manufacturer may be scouting out sites for a vehicle assembly plant.

Regardless of whether Mississippi lands that project, considerable additional automotive investment is on tap for the state. Development authorities say they’ve already been contacted by some 22 parts suppliers -- including about a dozen Tier Ones -- looking to set up operations to service the new Nissan plant. Three or four of the Tier One suppliers will be located adjacent to the assembly plant.

Nissan’s assembly plant in Smyrna, TN, has drawn some 132 suppliers to the state since 1981, says James C. Burns Jr., executive director of the Mississippi Dept. of Economic and Community Development, and Mississippi officials ultimately expect a similar scenario in their state.

"Initially, we’d be pleased if we got 20 suppliers in the beginning," says Mr. Burns, on hand at the SAE 2001 Conference here to promote economic development in the state. "But over the long haul we don’t expect to see much different from what happened in Tennessee."

Mr. Burns says the Nissan plant is expected to employ 4,000 workers, and studies suggest the spin-off effect eventually should mean the creation of six to seven times that number of jobs at related suppliers.

Mississippi, which kicked in an incentive package worth $295 million to land the Nissan plant, is confident the investment will pay off, says Mr. Burns. Conservative estimates suggest the plant will generate $640 million in tax revenues and $260 million in special funds over the next 20 years, Mr. Burns says.

"We feel good about it," the state official says. "It’s a mature plant -- it will be building 250,000 vehicles a year when it opens. So it’s a larger project than the Mercedes (120,000-unit capacity in two phases) and Honda (120,000 units at startup) plants in Alabama combined. We’re starting at a good point."

Mr. Burns says his department now is turning its attention to making sure it comes through on its promises of infrastructure and training support -- to prove it can handle investment of this scope.

"There’s a drive in Mississippi to become a major (player) in economic development," Mr. Burns says.