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Mitsubishi to start building Ark. plant this fall

Tue, 04/06/2010 - 3:30pm
CHUCK BARTELS - AP Business Writer - Associated Press

Mitsubishi said Tuesday it is aiming to 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 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 used to have 30 percent of the nation's wind turbine market, but competition from new production plants in the U.S. cut that 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. Gov. Mike Beebe, who rarely misses an opportunity to emphasize the link between education and economic development, said that in years past, Arkansas wouldn't have been the top choice.

But he said the University of Arkansas at Fort Smith and other state schools have become nimble enough to quickly train workers. Beebe said this helped land Mitsubishi and other big employers, such as Hewlett-Packard Co.'s 1,200-worker site in Conway.

"We now finish first, and it's not over," Beebe said.

Beebe also brought his checkbook. Mitsubishi will receive $3.75 million from the governor's 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.

"This is a measure of the manufacturing prowess of this city," Beebe said.

Fort Smith Mayor Ray Baker, 70, known for his enthusiasm even on an ordinary day, jumped in the air several times to emphasize points in his talk.

"It's not by accident that this city is the manufacturing capital of the entire state of Arkansas," Baker said, while in the air.

Baker said the city even has a nice breeze to offer.

"As the wind blows strong," he told Mitsubishi executives, "you'll be able to test your product."

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