Czech Tire Co. Buying Idle Winnebago Plant

July 21, 2010 by · Comments Off on Czech Tire Co. Buying Idle Winnebago Plant 

A tire company plans to open a plant at the former Winnebago Industries Inc. site in Charles City, Iowa, bringing nearly 200 jobs to the community.

CGS Tires US Inc., a subsidiary of CGS, a Czech Republic company, intends to begin production in Charles City in June 2011, the Mason City Globe Gazette reported.

“It’s very gratifying in a tough economy,” said Tim Fox, executive director of the Charles City Area Development Corp.

State and local officials worked for nearly a year to get the company to open a plant in Charles City.

City Administrator Tom Brownlow described the efforts as a “full-court press” that even involved Gov. Chet Culver.

The project will create 171 jobs in its initial phase.

The second phase is a warehouse and the third is a compound-mixing operation which will require construction of an additional building on site.

Company officials expect the second and third phases will increase the total number of jobs to 192.

The average starting wage will be $14.22 per hour.

Job training begins in January, according to Brownlow.

CGS is the second-ranked agricultural tire producer in Europe and fourth in the world, as well as the third-ranked industrial tire manufacturer in Europe.

Seventy-three percent of the company’s tire sales are in the agricultural sector while 20% are in the industrial sector.

Expected clientele include Caterpillar, New Holland and John Deere.

The Charles City plant will be CGS’s first North American manufacturing plant.

CGS, which was founded in 1932 and employs 4,701 people worldwide, currently has four manufacturing plants — three in the Czech Republic and one in Serbia.

The company has 13 sales offices, primarily in Europe. North Carolina is its only North American sales site.

CGS plans to spend $41 million to open the plant in Charles City, including purchase of the facility, building remodeling and construction, machinery and equipment, and job training.

“It’s a pretty sizable investment,” Fox said.

The company’s choice to make that investment in Charles City rather than the Czech Republic shows great confidence in what the community has to offer, according to Fox.

On Monday the City Council approved a resolution in support of an $924,000 application the company is making to the Grow Iowa Values Fund program.

Although the city isn’t spending money directly to get CGS to come to Charles City, the company qualifies for a property tax rebate agreement because the former Winnebago plant, which closed in August 2008, is located in the Southwest ByPass Tax Increment Financing District.

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