Top

Incentives Key to Moving Dometic Corp. Plant to Elkhart

July 22, 2009 by · 1 Comment 

dometic-thesignofcomfort2The biggest economic development announcement to hit the city of Elkhart, Ind., since the recession began quietly slipped in the back door Monday night (July 20) at a meeting of the Elkhart City Council.

There, it was revealed that Dometic Corp. was moving production of an RV refrigerator from Sweden to Elkhart later this year, bringing with it 241 new jobs.

“We’re happy it’s Elkhart. We’re happy it’s America,” said Douglas Whyte, Dometic president, in an interview the next day with RVBusiness.

The plant could have been relocated to China or Mexico but is coming to Elkhart because of Whyte and his management team, who see real advantages in moving the plant to within 50 miles of 70% of Dometic’s customers.

Also credit the city of Elkhart, which is providing hefty tax abatements or phase-ins, and the state of Indiana, which is provided unspecified training grants.

The Dometic operation will move into a 150,000-square-foot warehouse on the Dometic campus in Elkhart and feature a combination of manual and robotic equipment that is being moved from Sweden. Whyte said some $5 million to $7 million in equipment will be located to Elkhart from Sweden over the next three to five years, and an additional $3 million to $5 million in facility improvements will be made to retrofit the warehouse for the new production.

The Elkhart Truth  front page story on Tuesday (albeit secondary to the appearance of Miss America at the Elkhart County 4-H Fair the day before) was the first official word on the new jobs.

Dometic already has a presence in Elkhart, namely about 60 employees working in warehousing, customer service and human resources.

Whyte deferred further comment on the nature of the product and its manufacture and any sales projections until after the Elkhart City Council casts its final vote Aug. 3 on the 10-year, property tax phase-in. But suffice to say the operation will be high tech and require some skilled workers up and down the production line.

Dometic will sponsor a job fair in September to begin the hiring and training with production beginning in November, Whyte said.

The average blue collar worker wage will be $11.70. But high-paying new jobs will be created, from welding to engineering, production management and assembly.

Whyte hopes to tap the local labor supply and should have no problems, what with the community’s jobless nearing 20%. “My preference will be to pull these people from this area,” he said.

Whyte, who appeared at Monday’s city council meeting, said the incentives Elkhart offered “made a compelling story for why Elkhart.”

“The mayor and the state’s representatives were absolutely fantastic to work with in helping us through the process, and in negotiations everybody was professional. It was a nice  business arrangement so it meant a lot of sense to us,” he said.

The company plans to invest $500,000 in real property improvements, as well as $9 million to $12 million in personal property investments including the new equipment, according to city documents.

Through the phase-in, Dometic will save about $66,000 in real property taxes and $689,680 in personal property taxes. The company would pay $102,000 in real property taxes and $787,580 in personal property taxes over the life of the abatement,according to The Truth.

City officials estimate the jobs created will produce about $675,000 in local income taxes over the 10-year period. Dometic expects to retain about 12 full-time jobs in addition to the 241 new positions.

The company makes refrigerators, awnings, air conditioners and other products for the recreational vehicle and marine industries. Dometic Group’s international headquarters is in Solna, Sweden.

[Slashdot] [Digg] [Reddit] [Facebook] [Google] [StumbleUpon]

Bottom