Mitsubishi said this week it will produce wind turbines in Arkansas by next year at a new $100 million plant, a facility that signals the company is seeking to regain its U.S. customers.
Company executives gathered with state and local officials in Fort Smith, Arkansas to mark Mitsubishi's decision to build the plant, which will employ at least 400 people and help stem the tide of manufacturing jobs that have left the Fort Smith area.
Mitsubishi Power Systems Americas is to start construction in the fall, produce its first turbine next year and reach full production in 2012, said Ichiro Fukue, executive vice president of Mitsubishi Heavy Industries. About 200 construction jobs will be created as the plant is built.
The plant's work force could expand to 500, Fukue said, if the market grows.
Mitsubishi has installed more than 4,500 turbines worldwide including 3,500 in the US, where its workhorse 1 megawatt model has been popular with wind developers and utilities. “The US is our most important wind turbine market,” Fukue said.
The decision by European turbine makers to build turbine factories in the U.S., plus General Electric’s ability to ramp up production, cut Mitsubishi’s leadership last decade from 30 percent to 10 percent.
"By constructing this factory, we should catch up our lost market share," Fukue said.
Mitsubishi picked the Fort Smith area from among 60 U.S. cities. Fukue said the opportunity to build a supply chain in the Fort Smith area was a factor in selecting it over 59 other possible US sites.
"This is a measure of the manufacturing prowess of this city," says Arkansas Governor Mike Beebe, who also spoke along with US Senators Blanche Lincoln and Mark Pryor, and US Congressman John Boozeman.
Mitsubishi was also attracted by the region’s highway and railway infrastructure as well as the ability to ship turbines for export via the nearby Arkansas River.
Mitsubishi will receive $3.75 million from the state of Arkansas' Quick Action Closing Fund. It will also get a 15-year state income tax abatement, sales tax refunds for construction materials and equipment and other incentives.
The plant site is well-situated to take advantage of shipping options. Jonathan Wang, corporate planning manager for Mitsubishi, said planning is under way to utilize the Arkansas River, rail lines and highways, all of which are near the Chaffee Crossing site.
Fort Smith has endured an exodus of thousands of manufacturing jobs, especially when the Whirlpool Corp. refrigerator plant moved much of its production to Mexico. Local parts suppliers saw their orders drop or vanish.
Mitsubishi will use the Fort Smith plant to assemble the turbines, and Fukue said it will draw on local suppliers for parts. That includes Baldor Electric Corp., which is among the largest makers of electric motors.
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