Investing $57 million in facility
FRANKFORT, Ky. (Oct. 29, 2015) — Kobe Aluminum Automotive Products LLC (KAAP) will expand operations in Bowling Green, adding 112 jobs while investing $57 million in the facility.
“Kobe Aluminum Automotive Products has enjoyed great success since locating in the commonwealth in 2005,” Gov. Steve Beshear said. “This expansion will help the company continue to work hand-in-hand with the changing auto industry and its emphasis on using aluminum.”
The more than 116,000-s.f. addition will provide Kobe Aluminum with capacity for substantial equipment upgrades. The company anticipates growing its business in coming years, and the expansion will support those changes. Construction will begin in December and is expected to be finished by October 2016.
Kobe Aluminum began production in Bowling Green in 2005 and currently employs 368 Kentuckians. The company invested in five previous expansions totaling $236 million.
“We are very excited about the opportunity to grow our business and provide new careers to many south-central Kentucky residents,” said Chris Boggs, general affairs and human resources manager for Kobe Aluminum. “We look forward to adding new members to the Kobe Aluminum family, and we are proud of the impact this will have on our state, city and community.”
Kobe Aluminum, based in Kobe, Japan, has served its home country’s aircraft and automotive industry since 1937, primarily manufacturing forged aluminum suspension products. The company is part of the Kobe Steel Group, known internationally as KOBELCO. Kobe Aluminum (KAAP) develops lightweight aluminum parts contributing to the overall reduction in vehicle weight, which helps to lower fuel consumption and emissions.
The commonwealth is home to more than 150 aluminum facilities and employs nearly 18,000 full-time workers. According to the U.S. Geological Survey, Kentucky has the greatest capacity to produce aluminum in the nation. Aluminum accounts for $2 billion in the state’s gross domestic product.
There are currently more than 170 Japanese-owned facilities in Kentucky employing nearly 42,000 people. Since January 2014, Japanese-owned facilities have announced 59 new locations or expansion projects with a total investment greater than $897.3 million and more than 2,000 new full-time jobs
To encourage the investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) preliminarily approved the company for tax incentives up to $2.7 million through the Kentucky Business Investment program. The performance-based incentive allows a company to keep a portion of its investment over the agreement term through corporate income tax credits and wage assessments by meeting job and investment targets.
Additionally, KAAP was approved by KEDFA for $300,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing equipment.
KAAP also is eligible to receive resources from the Kentucky Skills Network. Through the Kentucky Skills Network, companies are eligible to receive no-cost recruitment and job placement services, reduced-cost customized training and job training incentives. Last year, the Kentucky Skills Network trained more than 84,000 employees from more than 5,600 Kentucky companies.