Electrolux leaders and state, county and city officials gathered for a groundbreaking ceremony yesterday at the site of a new North American Cooking Products manufacturing center in Memphis. The October 5th groundbreaking appears to end the uncertainty that manifested early in 2011 over government incentives and unexpectedly high construction bids.
"With the addition of this facility, Tennessee will become the North American Center of Excellence for Electrolux cooking product development and manufacturing,” said Jack Truong, president and CEO of Electrolux Major Appliances, North America. “We are very excited to see the hard work of the past 10 months come to fruition and thank the city, county, and state for their support of Electrolux Company.”
Electrolux announced last December that it had chosen Memphis for its new North American Cooking Products manufacturing center. Electrolux detailed its reasons for choosing the site:
• Synergies with other Electrolux plants, which will allow the company to better leverage existing resources, especially those at its cooking plant in Springfield, TN.
• Memphis’s resources and location advantages, including the skilled labor pool, the area’s central location, and logistics, which will improve access to key markets, customers and suppliers.
Incentives, however, were also a factor, with the Memphis Commercial Appeal media outlet estimating that state, county, and local governments subsidized the plant to the tune of $188 million.
In fact, the State of Tennessee promised $97 million in incentives to help convince Electrolux to build the plant in Memphis, but couldn't get the firm money commitments that it promised Electrolux would have by Jan. 31, 2011. The incentive commitments issue was solved, but new problems cropped up in August and September when construction bids started coming in at $30 million more than expected.
The Memphis plant is expected to employ 1,200 workers to build the company’s Electrolux, Electrolux ICON brand, and Frigidaire brand built-in and specialty cooking appliances. The plant is expected to be fully operational in 2014.
"The state of Tennessee has been very supportive of Electrolux over the years and we appreciate their continued support as we realize our vision of making Tennessee the North American Center of Excellence for Electrolux Cooking Products,” said Truong.
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