Kentucky takes top honors in national magazine’s 2011 Economic Development Deal of the Year competition
Strategic partnership between the Commonwealth, Ford Motor Co. leads to massive job creation and investment
FRANKFORT, Ky. (Jan. 6, 2012) – The Commonwealth of Kentucky and Ford Motor Co. have earned the distinction of being named 2011 Economic Development Deal of the Year by national magazine Business Facilities. The project, which was selected by a judging panel of industry experts, emerged as the winner in a competitive field of 23 other big-ticket projects from across the U.S.
“It is incredibly exciting and rewarding to be recognized as having the 2011 Economic Development Deal of the Year,” Governor Steve Beshear said. “Our strategic effort to secure Ford’s long-term investment in Kentucky and its workers was a win-win situation for all, resulting in $1.2 billion in new investment and 3,100 new jobs announced within 10 months’ time.”
Beshear said the recognition is due to the hard work and dedication of many local, state and business leaders.
“We know that these kinds of commitments don’t just happen,” he said. “They are the result of ongoing relationships, cooperation and forward thinking. Kentucky is proud to be the home of two Ford assembly plants and appreciates being given this honor by Business Facilities magazine.”
“Our judges really were impressed by the creative use of incentives in this project,” Business Facilities Editor-in-Chief Jack Rogers said. “The incentive package for the Kentucky-Ford Partnership was structured in a way that it could be renegotiated to induce additional investments made at either of Ford’s plants in Louisville, giving the state more flexibility to negotiate.”
Ford announced in late 2010 an investment of $600 million to transform the company’s Louisville Assembly Plant (LAP) into the company’s most flexible high-volume plant in the world – resulting in a second shift and 1,800 new jobs at the plant. In the fall of 2011, Ford announced a new contract, which workers ratified, that will bring a third shift and another 1,300 jobs to LAP, raising the total new-job count to 3,100.
The contract also secured a separate, $600 million investment at Ford’s Kentucky Truck Plant (KTP) to include a new stamping press. The KTP investment will allow for modernization of tooling for the next generation F-Series Super Duty trucks and the Expedition and Lincoln Navigator SUVs.
“Governor Beshear and his economic development team, working together with industry and community partners, created a business case that allows Ford to continue to invest and grow in Kentucky,” said Ford Vice President for North American Manufacturing Jim Tetreault. “A strong government/industry partnership is a critical advantage in today’s globally competitive environment.”
Over the years, Ford’s Kentucky plants have produced some of the world’s most popular vehicles, including the Ford LTD, Ranger, Bronco II, Explorer, F-series Super Duty pickup trucks and Lincoln Navigator. But as Ford and the rest of the auto industry hit hard times, the labor force dwindled, and the plants, especially Louisville Assembly, grew more obsolete, said Cabinet for Economic Development Secretary Larry Hayes.
For the first time in a long time, Ford’s future in Kentucky was in doubt, Hayes said.
The Cabinet began working with Ford and the state legislature to take action. The result was a new incentive program in 2007 called the Kentucky Jobs Retention Act (KJRA).
The incentive package was structured in a way that it could be renegotiated to induce additional investments made at either Ford plants in Louisville – giving the state more flexibility to negotiate and giving Ford more reason to make long-term investments in the Commonwealth, Hayes said, adding that the program contains mechanisms to protect the state’s interest.
An economic impact study performed by the Cabinet shows the direct annual economic impact of Ford’s new full-time jobs on the state’s GDP will be approximately $798 million. Indirect and induced jobs will add more than $1.2 billion more.
“The Ford deal has been among the most positive economic developments in any city in America in 2011, and it’s nice that others are also recognizing that,” Louisville Mayor Greg Fischer said.
“I am pleased that Ford, the United Auto Workers and the Commonwealth of Kentucky are getting deserved recognition for this project,” said Rep. Larry Clark, of Louisville. “This investment will allow Ford to modernize its Louisville production facilities and create thousands of new jobs. None of this would have happened without cooperation between the company and the United Auto Workers. I applaud both the company and the union for their efforts, and I look forward to a great partnership between them and the Commonwealth that will yield significant economic benefit for generations to come.”
“This is a very exciting announcement that recognizes another chapter in a strong and successful partnership between Ford Motor Company, the UAW, the Kentucky Cabinet for Economic Development Cabinet and Louisville Metro Government,” said Eileen Pickett, executive vice president of community and economic development at Greater Louisville Inc. – the Metro Chamber of Commerce. “This reinvestment further solidifies Louisville’s reputation as a flourishing center for advanced manufacturing on an international scale.”
Business Facilities will feature the Kentucky-Ford partnership as the cover story in its January/February issue. The story is featured on its website at businessfacilities.com/news/kentucky-sc-arizona-shine-in-business-facilities-awards-contest.
Information on Kentucky’s economic development efforts and programs is available at www.ThinkKentucky.com.
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