VOLVO IN SOUTH CAROLINA
VOLVO HOW SOUTH CAROLINA LANDED THE CAR MAKER
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The Road The story of to Ridgeville the Volvo deal
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The ‘Volvo Effect’
‘Change is coming’
Timeline charts the first phone
Gov. Nikki Haley talks about
State’s third car plant set to
Ridgeville residents yearn
call to the final decision
tense negotiations, site swap
expand S.C. automotive sector
for growth, wary of change
Photo/Volvo
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June 1 - 14, 2015
VOLVO IN SOUTH CAROLINA
VOLVO
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ore than $1 billion in investment has been committed to the Charleston region by two European automotive companies in less than three months. First, Mercedes-
Benz Vans announced in March it would expand operations to build a new manufacturing facility for its Sprinter vans. Now Volvo wants to build cars in the Lowcountry. Volvo, headquartered in Gothenburg, Sweden, selected South Carolina over a handful of Southeastern states for its entree into North America. The company joins BMW, Michelin, Boeing and others who manufacture products in the Palmetto State. Go in-depth into the Volvo project with this special report that navigates the course of the economic development deal that almost didn’t happen.
“Half-a-billion-dollar investment, 4,000 jobs coming to our great state. We will very much be proud to say that we now build Volvo Cars.” Gov. Nikki Haley
“This will change the course of people’s lives in the region in a fashion that most people cannot fully imagine.” Bobby Hitt S.C. Secretary of Commerce
“Volvo Cars will do much more than make automobiles in Berkeley County. Volvo will raise the standard of life throughout the Lowcountry.” Lonnie Carter Santee Cooper CEO
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The Road to Ridgeville August: Volvo execs tell state officials South Carolina is a contender for the plant.
Feb. 5: Commerce Department officials tell Berkeley County to move quickly after a Dorchester County site fell through and warns all involved to keep quiet about the project.
Jan. 21: North America CEO Lex Kerssemakers says Volvo might build a U.S. facility. S.C. officials are already working in secret on potential sites. April 16: Berkeley County files a regulatory permit with the U.S. Army Corps of Engineers, Charleston District, on behalf of an undisclosed manufacturer referred to as “Project Soter.”
Late February: Volvo officials tour the Charleston region via helicopter, landing at the Camp Hall Tract to see it firsthand.
Graphic/Andrew Sprague
S.C. officials negotiated with Volvo executives and competed with other states for months to bring the car plant and 4,000 jobs to South Carolina.
March 1-4: Gov. Nikki Haley and Commerce Secretary Bobby Hitt travel to Europe without disclosing why. S.C. officials meet with Volvo executives in Sweden. Haley said negotiations stalled at one point, but S.C. remains in the running.
March 30: Volvo officially announces plans to build a U.S. plant. Rep. Chip Limehouse tells the Business Journal the automaker is considering a site in Berkeley County.
April 21: North Carolina out of the running for the Volvo plant.
May 8: Haley gives a University of South Carolina commencement speech before a 6 p.m. phone call from Kerssemakers: “We decided to go with South Carolina.” The news is not yet public.
April 29: S.C. officials fly to New Jersey and make a final pitch to Volvo executives in New York City. Georgia officials did the same. They leave not knowing who won the deal. May 10: Santee Cooper calls a special Mother’s Day board meeting to vote on undisclosed economic development agreements that include $54 million in incentives and plans to buy 6,800 acres for an industrial park that will house the Volvo plant.
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May 11: Volvo sends out a news release at 6 a.m. Eastern time confirming Berkeley County as the site for its U.S. car manufacturing plant. State and business leaders meet at the Governor’s Mansion at 10:30 a.m. to make the formal announcement.
2,000
2018: The first vehicles are expected to roll off Volvo’s new assembly line.
jobs initially,
4,000 jobs over the next decade
Fall 2015: Construction of the Volvo plant to begin.
Ridgeville
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June 1 - 14, 2015
The twists and turns of steering Volvo toward South Carolina By Liz Segrist
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lsegrist@scbiznews.com
he race was on. State Commerce Secretary Bobby Hitt received a tip in July that South Carolina was among a handful of Southeastern states in the running for Volvo’s first North American manufacturing facility. When a phone call a month later confirmed Volvo’s interest in the state, Gov. Nikki Haley had one response. “Let’s go get it.” Haley sat down several weeks after the deal was announced to talk about the hunt for the high-end automotive manufacturer. “It was a roller coaster ride after that,” Haley said of the phone call. Numerous state agencies worked together to make the deal happen. Over the next 10 months, meetings took place in downtown Charleston restaurants, at Volvo’s legal offices in New York City, at the company’s headquarters in Sweden and during site visits all over the state. Volvo officials had a big decision to make: Pick a site that could buoy U.S. sales, generate product excitement and expand its global market share. The site needed to be near major high-
Volvo plans to invest $500 million in building its car plant at the Camp Hall Tract in Berkeley County. The company expects to produce 100,000 cars a year once it begins production in 2018. (Photo/Volvo)
ways, an international airport and a port with a track record of shipping cars. The company wanted to plant roots in a state that promoted business and offered a skilled, trainable workforce. Hitt said his team tried to glean as much information as possible about Volvo’s needs in those initial meetings.
Commerce had three sites across the state chosen as options. Hitt declined to mention specific sites but said “they were in three distinct regions of the state.” A lot was at stake for the Sweden-based, Chinese-owned automaker as it made its foray into becoming a “Made in America” manufacturer.
Meetings between company and state officials were ongoing throughout the fall and into early this year. Volvo officials wanted to investigate every claim made about successful manufacturing facilities, training programs and logistics operations in the state. They visited readySC’s Boeing train-
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ing center at Trident Technical College in North Charleston and then saw Boeing employees building planes at the Dreamliner plant. They visited BMW Manufacturing Co. and the S.C. Inland Port in Greer and stopped by the Clemson University International Center for Automotive Research in Greenville. Volvo met three times with the S.C. State Ports Authority to see how the Port of Charleston handles cargo. At the Columbus Street Terminal, Volvo officials watched as port workers drove BMWs off trains and onto containerships. They envisioned the possibility of those being Volvo vehicles one day. Dorchester County offered an attractive site off Interstate 26 for the Volvo plant, but environmental studies revealed the land held too many wetlands. Building there could limit the size of Volvo’s footprint and harm the site’s ecosystems. So six months into negotiations, the state had to present an entirely new site to Volvo. “That was a little bit of a scary time from my side,” Hitt said. “Generally speaking, when you’re several months in, changing sites can be a sign of weakness that we didn’t have it put together just right. We were semi-starting over, but we put together a plan.”
Shifting gears
Haley said the site switch was
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VOLVO IN SOUTH CAROLINA
nerve-wracking for everyone involved on both sides of the Atlantic. Commerce officials scrambled to keep the company interested. Berkeley County Supervisor Bill Peagler received a call on Feb. 5 about Volvo. Peagler remembers saying to Barry Jurs, the county’s economic development director: “Do whatever you have to do to make this happen.” Officials from Berkeley County, Santee Cooper and Commerce met secretly in Columbia. By the end of the meeting, plans were in motion to prep a new site across Interstate 26 in Berkeley County. The 6,800-acre, undeveloped Camp Hall Tract would be the state’s new pitch to Volvo. Santee Cooper had been working with the state on the Dorchester County site, so it was familiar with the project when the deal transitioned across county lines, said Sam Bennett, Santee Cooper’s economic development manager. During one visit to the Lowcountry in February, Volvo officials took helicopter rides from Charleston International Airport to get a bird’s-eye view of the region and survey the new site. “We were trying to build up the same level of trust that Dorchester County had done such a good job of doing,” Bennett said. “It was very tense for us and maybe see VOLVO, page 40
VOLVO IN SOUTH CAROLINA $500M
investment by Volvo
$204M
in incentives to recruit Volvo
2,000
jobs initially
2,880
acres of the 6,800acre Camp Hall Tract will be used by Volvo
4,000
jobs over the next decade
100,000
cars will be produced annually from the site
VOLVO CARS GROUP The first Volvo rolled off the production line in 1927. Headquartered in Gothenburg, Sweden, Volvo Cars now produces sedans, wagons, sport wagons, cross country cars and SUVs, including the recently debuted Photo/Volvo XC90 SUV Crossover. Volvo Cars’ global sales in 2014 were 465,800 cars, up 8.9% from 2013. U.S. sales have been declining, and in 2014, China overtook the United States to become Volvo Cars’ largest single market. Zhejiang Geely Holding Group of China acquired Volvo Cars from Ford Motor Co. in 2010. Volvo Cars’ production takes place in Sweden, Belgium, China and Malaysia — and soon, South Carolina. The first cars are expected to roll off the Berkeley County assembly line in 2018. Volvo Cars employs about 26,000 people worldwide as of 2014. The new site will add up to 4,000 jobs in the Charleston region over the next decade. Source: Volvo Cars
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Commerce Secretary Bobby Hitt and Gov. Nikki Haley gather with business leaders and economic developers to announce that Volvo picked Berkeley County for its North American car plant. (Photo/Chris Cox) VOLVO, continued from Page 39
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for them. The sites had just been swapped. ... We did not know how they felt because we don’t speak Swedish, and they had full conversations in front of us.” South Carolina remained in the running, along with the known competitors of Kentucky, North Carolina and Georgia. Volvo took interest in the Berkeley County site. South Carolina had its confidence back. Haley thought they were in the homestretch.
Then S.C. officials heard that Georgia recruiters were headed to Volvo’s headquarters in Gothenburg, Sweden. Hitt asked Haley to join him on a last-minute recruitment trip to Sweden in early March to show that they were serious. At a table in a boardroom, Volvo attorneys sat on one side and S.C. officials sat on the other. Conversations were flowing. Then they hit a wall. Negotiations stalled. Haley said she could feel Volvo’s apprehension about the project details, numerous regulations and environmen-
WAGES AND IMPACT Volvo has not disclosed wages for workers at the new plant. Data gathered by the U.S. Bureau of Labor Statistics shows what various production workers made last year in South Carolina. Overall, production workers made $17.56 an hour on average for a $36,520 salary. Helpers/production workers
$11.84
All other production workers
$17.56
Engine and other machine assemblers
$17.48
Machinists First-line supervisors of production and operating workers
Photo/Volvo
$18.46 $29.23
Industrial production managers
$51.87
Source: U.S. Bureau of Labor Statistics 2014 data
VOLVO
For every job at the Volvo plant, three other jobs will be created. Source: University of South Carolina analysis by Joseph Von Nessen
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tal concerns. Choosing the wrong site could jeopardize the company’s plans to increase U.S. sales. For South Carolina, half a billion dollars in investment and at least 4,000 jobs were on the line. Haley said she remembers telling company officials the state would deliver for them: “In order for us to do this, we have to trust each other and I’ve got your back. And if you will let us do what we do best, which is build things, we will make sure that Volvo is a showcase item around the country.” After the Sweden trip, plans were taking shape for the new site. Berkeley County filed a permit in mid-April with the U.S. Army Corps of Engineers, Charleston District, on behalf of the company under the code name “Project Soter.” The Charleston Regional Development Alliance compiled marketing materials to present to Volvo that would differentiate the Lowcountry from other sites, CEO David Ginn said. Officials from Commerce, Santee Cooper and Berkeley County joined Hitt and Haley on a trip to New York City to make a final pitch to the Volvo North America executive and legal team. “This was the one project to date that we truly did not know where we stood,” Haley said. “I mean, there was no gut feeling. No anything. ... They were amazing at keeping their emotions to the chest.” The team left New York unsure of whether they had won the deal for South Carolina.
Decision time
Volvo had made a decision, and it looked like it was South Carolina. Lex Kerssemakers, president and CEO of Volvo Cars of North America, canceled a phone call with Haley on May 8 and said company officials were instead coming to South Carolina in person. Then while Haley was giving the commencement speech at the University of South Carolina, Volvo canceled the trip and rescheduled the call. She worried her state had lost the deal to Georgia. Staff members from the governor’s office and the Commerce Department gathered in the library of the Governor’s Mansion at 6 p.m. that evening for the call. Haley wanted to be in her favorite room in the house. A portrait of Gov. Carroll Campbell, who landed the BMW deal 23 years ago, hangs in the room. Haley put the phone on speakerphone and set it on the table. The group waited impatiently while Kerssemakers talked about the negotiations. “Then he said ‘We want to come to South Carolina,’ and there was just a roar in the room. Everybody was so excited and so happy,” Haley said.
CEO’s perspective
The news was not yet public. Two days later, on Mother’s Day, the Santee Cooper board of directors called a special meeting to vote on an agreement that
VOLVO IN SOUTH CAROLINA
would provide $54 million in incentives to Volvo. The state-owned utility would buy the 6,800-acre Camp Hall Tract and develop it for Volvo and future industry. That Monday, May 11, the company confirmed its decision in a news release at 6 a.m. Eastern time. By 10:30 a.m., Haley, Hitt and nearly 30 economic developers and business leaders involved in the deal gathered in front of the Governor’s Mansion in Columbia to make the official announcement and to field questions from reporters. “In less than 100 days, we were able to accomplish what normally takes a year or more to accomplish,” Berkeley County’s Peagler said, referring to the last-minute switch to his county’s site. South Carolina is now home to three automobile manufacturers: BMW in Greer, Mercedes-Benz Vans in North Charleston and, soon, Volvo Cars in Berkeley County. South Carolina is one of the only states winning automotive manufacturing plants. Ten new vehicle assembly plants have been announced in North America since 2009; of those, eight have been in Mexico and two have been in the Charleston region, according to the CRDA. “In order to be a successful state, you have to always think about it from the CEO’s perspective,” Haley said. “You have to always look at it and say, ‘What does the business want?’ ” Haley said it matters how state agencies are run — companies want to move quickly through permitting process. It also matters whether agencies are willing to collaborate with state and company officials, as well as with one another, in the way environmental groups and economic developers did on the Volvo deal. Manufacturers want large sites to be near infrastructure, she said. They want to know they can find qualified workers, and they want to talk with companies that have set up shop in the state. “They want a state that understands business, and whether it’s a union trying to take over, whether it’s (Washington) D.C. trying to infringe, or whether it’s something they don’t foresee — they want to know that we’re going to have their back,” Haley said.
Quality of life
Officials said the Volvo plant will improve the quality of life for residents and reshape the region by bringing growth and job opportunities, especially for people living in poor or rural counties near the site. Haley said K-12 education and workforce training matter now more than ever. “That’s the big key component for me right now is making sure that South Carolinians get these jobs, because that’s what we worked so hard to do,” she said. cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
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The Georgia tortoise that helped S.C. win Volvo By Andy Owens
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aowens@scbiznews.com
t’s probably not fair to say that Volvo chose South Carolina just to avoid an environmental public relations nightmare, but there’s little doubt that the gopher tortoise — the burrowing state reptile of Georgia — played its part. Even Georgia Gov. Nathan Deal tried to spin the tortoise’s shell in his state’s favor up until the last minute, telling The Augusta Chronicle that he wasn’t all that concerned about having an environmentally sensitive species living on the 1,900acre site the state had chosen for Volvo. Deal said the tortoise’s absence from the endangered species list in Georgia showed environmental stewardship on the state’s part that any company, including Volvo,
The gopher tortoise is the state reptile of Georgia, but it also lives in a few parts of S.C. (Photo/Tom Friedel)
would want to align itself with. “That is considered environmentally friendly, and because of that, the gopher tortoise is not on the endangered list in Georgia because we’ve been responsible,” Deal said. Officials in Berkeley County were aware of the tortoise’s presence on Georgia’s proposed site — and of possible plans to relocate the reptile. County Supervisor Bill Peagler told the county’s economic director that he felt the S.C. site was a
strong one for several reasons. “We had water. We had sewer. We had available land. We did not have any issues with animals needing to be relocated,” Peagler said. The Atlanta Business Chronicle went even further, publishing a story that said the tortoise could actually help win Volvo for Georgia. The thing that Deal, The Augusta Chronicle and the Atlanta Business Chronicle failed to report was that the
tortoise isn’t endangered in any state. If, like the gopher tortoise, Georgia journalists had dug a little deeper, they would know that the U.S. Fish and Wildlife Service does list the tortoise as threatened in Alabama, Mississippi and Louisiana, meaning it is only in jeopardy of being listed as endangered in those states. The tortoise is also a candidate for threatened status in Florida, South Carolina and Georgia. One could make the case that South Carolina is at least as good as Georgia in taking care of this tortoise. The governor wasn’t being disingenuous about the Peach State’s care for the creature. Georgia has passed legislation to prohibit the use of gopher tortoise holes for hunting snakes. The tortoise is considered critical to the surrounding ecology because its burrows create habitats for other animals. Although the tortoise doesn’t live anywhere near the Volvo site in Berkeley County, it does inhabit a designated Wildlife Management Area in Williston. So South Carolina’s state reptile is the loggerhead sea turtle, but we’ve established a safe zone for Georgia’s state reptile. cr bj
Reach Andy Owens at 843-849-3142. Liz Segrist contributed to this report.
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The Volvo plant in Berkeley County is expected to have a ripple effect in the economy. (Photo/Volvo)
Automotive multiplier expected to extend impact of Volvo plant By Liz Segrist
lsegrist@scbiznews.com
W
hen BMW decided to expand manufacturing outside of Germany and make cars in South Carolina, its U.S. sales were down from 100,000 in 1986 to 53,000 in 1991. The German automaker announced plans in 1992 to build a manufacturing facility in Spartanburg County, hoping to boost lagging sales. The company’s plans hinged on a workforce that had never built cars. Though South Carolina’s Upstate had attracted many international companies, such as Bosch’s engine plant and Michelin North America’s headquarters, much of its roots were based in lower-wage textile jobs and agricultural work. All eyes were on BMW and S.C. workers to see if they could successfully build BMWs and boost the U.S. market share from a facility in the small, rural city of Greer. BMW Manufacturing Co.’s workers rolled the first 318i sedan off production lines in 1994 and the Z3 roadster soon thereafter.
BMW now has nearly 8,000 workers and makes an annual economic impact of $16 billion on the state, according to a 2014 study by University of South Carolina researcher Doug Woodward. The company celebrated the production of 3 million S.C.-built cars this year. Twenty-three years after BMW announced its plans to bring manufacturing operations to South Carolina, Volvo Cars has made the same decision. This time, Berkeley County scored the manufacturing plant.
Same goal, different landscape
Volvo is in a similar situation to the one BMW faced in the ’90s. Part of the Sweden-based automaker’s decision to bring production to North America is to boost lagging U.S. sales, which were down to 56,000 units last year from more than 120,000 in 2004. The Chinese-owned company wants to produce 100,000 vehicles a year from the Lowcountry plant with production beginning in 2018. “Volvo is almost exactly the same size coming here today as when BMW came here in the ’90s,” said S.C. Commerce Secretary Bobby Hitt, a former BMW
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executive who was involved with negotiations to recruit both automakers. Both automakers were looking to boost U.S. sales and expand their global reach — and both companies are relying on South Carolina’s workforce to do so. But Volvo is coming into a very different environment than BMW did. South Carolina now has more than 200 automotive-related suppliers within its borders. It is the No. 1 tire producer and exporter in the country and houses five tire companies. Volvo could look to the successes of BMW or Boeing South Carolina’s 787 Dreamliner campus in North Charleston. Volvo saw firsthand how readySC and the state’s technical colleges create customized workforce training programs to support these companies. The political environment and recruitment tactics have also changed. Gov. Nikki Haley recruits manufacturers aggressively, touting a business-friendly environment where unions are not welcome and agencies collaborate on economic development. Haley and Commerce officials want to attract advanced manufacturers with large employee counts. They offer a comprehensive package to companies: a path to train workers, large tracts of land that can be developed, nearby airports, a growing port that’s poised to deepen its harbor and attractive incentives. State incentives help pay for workforce training or infrastructure needs, such as site prep, new roads and highway interchanges, utility connections and rail access. County incentives often provide fee-in-lieu-of-tax agreements when companies hit hiring targets. All of these factors helped South Carolina beat out neighboring states and land the Volvo deal — and they could play a role in Volvo’s growth going forward. “I marvel that 25 years ago, nobody in this state thought about building cars,” Hitt said. “Nobody came out of school preparing to work in the auto industry, and certainly no one was thinking about aerospace. ... The transformation of South Carolina into an advanced manufacturing state has been an incredible change that continues at a remarkable pace.”
Ripple effect
Daimler announced in March that it will invest about $500 million in an automotive plant in the Lowcountry. The company’s Mercedes-Benz Vans division will build next-generation Sprinter vans in North Charleston rather than solely importing parts from Germany and assembling them here. With the new Mercedes-Benz and Volvo Cars plants bringing a combined 5,300 jobs and $1 billion in investment to the Lowcountry over the next decade, the region has the potential to become a major automotive hub in the state and the country, according to Joseph Von Nessen, a research economist with the University
VOLVO IN SOUTH CAROLINA
Joseph Von Nessen Research economist with the University of South Carolina
“For every one job at Volvo, three more jobs will be created in the supply chain.” of South Carolina. “In the last 20 years, the Upstate has been an excellent example of an automotive cluster blossoming in South Carolina, and there’s no reason to think Charleston can’t do the same thing,” Von Nessen said. Volvo plans to hire 4,000 people over the next decade to build cars at its Berkeley County plant. For every one job at Volvo, three more jobs will be created in the supply chain, Von Nessen said. As the plant uses suppliers in the existing automotive supply chain, those companies are expected to grow and hire more workers to meet the demand. Volvo will also likely bring new suppliers to the state. Automotive plants tend to have a higher employment multiplier and higher wages than other sectors because the industry can scale up employment quickly and continue that growth for years, Von Nessen said. Volvo plans to create 2,000 direct jobs initially. Those jobs are expected to create more than 8,000 total jobs as a result, according to an economic impact analysis compiled by Frank Hefner at the College of Charleston. In addition to supplier growth, the plant will contribute around $4.8 billion in total economic output each year, Hefner found. Area residents will likely spend more money in the community. Employees that relocate will require new housing and commercial developments. Since BMW opened its doors, Greer has changed from a mostly rural community to a bustling area with more residents and jobs. Economists and state officials expect similar growth in the counties surrounding the Volvo plant. “People will have access to jobs in the area that they do not have now,” Hitt said. “This will change the course of people’s lives in the region in a fashion that most people cannot fully imagine.” cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
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Ridgeville on the edge of change By Liz Segrist
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lsegrist@scbiznews.com
he line at Dukes Bar-B-Q in Ridgeville goes nearly out the door at noon on a Friday. Gayle Dunning quickly fills patrons’ plates with heaping portions of barbecue and vegetables in the buffet line. Her husband, Robert, cooks in the back. Big jugs of sweet tea sit on tables covered with flower-patterned vinyl tablecloths. Friends squeeze into seats at long tables. Everyone seems to know everyone. Dunning opened Dukes 37 years ago. It is one of the few buildings that make up the center of town. A general store, a few restaurants, a gas station and some shops form a semicircle around the rail line. Ridgeville sits about seven miles from the future site of Volvo, which lies on the other side of Interstate 26 off exit 187, just across the Berkeley County line. Dunning said she is excited about the opportunities the new Volvo car plant will likely bring to the rural Dorchester County town. “Some people might not like change, but change is coming,” Dunning said. “I
Vaughan’s General Store opened in Ridgeville in 1933. It is one of a handful of businesses that make up the heart of Ridgeville. A rail line intersects the center of town. (Photo/Kathy Allen)
don’t think we will know and recognize Ridgeville in the future the way we know Ridgeville today.”
A mayor’s perspective
Mayor James Williams remembers the Ridgeville of his childhood as a small
town with two of everything — schools, bathrooms and drinking fountains — one for blacks and one for whites. Decades later, the town has changed but remains small. The U.S. Census Bureau lists Ridgeville’s population at 1,600, but Williams said if you subtract
inmates at Lieber Correctional Institute, the town has about 700 people. Williams said Ridgeville has always been a community where country people get along, everyone knows each other’s families and people generally want things to stay the same. The mayor’s office is in the town’s municipal building, which resembles a school and sits a block away from the only stoplight in town. He is the lone person working there on a Friday. A map of Ridgeville is pinned to a corkboard on the wall. Williams’ desk is covered in stacks of papers. He holds up plans for a new Family Dollar and talks about the changes coming. He sees the future Ridgeville as an extension of Summerville. Developers have been knocking on his office door to talk about buying 80-acre tracts of land for new neighborhoods. Plans are in the works to build a grocery store-anchored shopping center nearby. Williams said he wants to annex developed properties into the town to provide a much-needed boost to its tax See RIDGEVILLE, Page 48
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Residents talk about the growth and jobs that the Volvo plant will bring to Ridgeville during lunch at Dukes Bar-B-Q, one of the few restaurants in town. (Photo/Kathy Allen) RIDGEVILLE, continued from Page 46
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base. More money will allow the town to provide more services to residents, such
James Williams Ridgeville Mayor
“The future generation will have so many possibilities.” as water and sewer — many homes currently rely on septic tanks and well water. He said more people will be able to get jobs near their homes when Volvo opens. “This is a win-win situation for our town. The younger generation coming out of high school, especially those that cannot afford college, can study the right subjects in school and get the training to land them a job at Volvo or at the suppliers that will follow,” Williams said. “The future generation will have so many possibilities.”
Small town, big business
Showa Denko Carbon, Key West Boats, county schools, farms and a few small businesses account for most of the town’s employers. Many residents currently travel to other communities to find work. Betty Coburn, a lifelong resident who has worked at Vaughan’s General Merchandise and Furniture Store for 25 years, hopes the Volvo plant will help people in Ridgeville find jobs closer to home. Volvo plans to hire 4,000 people over the next 10 years. The automaker is working with readySC on training programs. More jobs will mean more housing
and commercial developments and more money flowing through the community. The plant could also bring more employers to the area. About half of the 6,800-acre Camp Hall Tract will be used by Volvo. The remaining land is being readied by local and state officials for other industry or Volvo suppliers. Many residents look forward to the potential economic growth and job opportunities; others fear development infringing on farms, especially in the Pringletown area that sits on the same side of I-26 as the Volvo site. Scott Vaughan — the owner of Vaughan’s, the town’s family-owned general store since 1933 — said the Volvo plant will be an economic boon for the area, but he worries about chain stores moving into town and increased traffic congestion.
Gayle Dunning Owner of Dukes Bar-B-Q
“I don’t think we will know and recognize Ridgeville in the future the way we know Ridgeville today.” Dunning said she understands concerns, but she thinks the town will prosper. “As Volvo grows, even more industry will follow its lead and move to the area,” she said. cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
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Volvo, environmentalists work out mitigation plan By Liz Segrist
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lsegrist@scbiznews.com
olvo and the state plan to permanently protect 1,500 acres of wetlands in the Lowcountry to compensate for the 217 acres of wetlands that will be impacted when the car plant is built in Berkeley County. “A large amount of wetlands will be impacted, which is why I think they felt compelled to do some really extraordinary mitigation,” said Norman Brunswig, the former executive director of Audubon South Carolina. “It never feels good to see wetlands lost. It is never easy to see them sacrificed. But the scale of the mitigation was such that it seemed like a good trade to me.” The S.C. Commerce Department asked Brunswig for his input on which areas needed protection during the environmental negotiations with Volvo. Brunswig, who recently retired, spent his entire 41-year career managing the Francis Beidler Forest through the National Audubon Society. Brunswig agreed to help if the mitigation plans would protect the Four Holes Swamp area, which includes the Francis Beidler Forest that sits near the future home of Volvo. Volvo Cars proposes to preserve, enhance or restore 1,533 acres of wetlands within about 2,500 acres of property in the Dean Swamp and Walnut Branch watersheds and Four Holes Swamp tributaries, which will be protected. The state will purchase the mitigation property and easements as part of its incentives. The areas that will be protected house numerous species and trees that are hundreds of years old, Brunswig said. “Very specific species find their habitat there. They can’t find it anywhere else. ... When you alter a wetland, sometimes you alter the best habitat in the neighborhood,” Brunswig said. “This agreement provides permanent protection for these wetlands.” Brunswig said the wetlands on the Camp Hall Tract, where Volvo will employ up to 4,000 people, have already been altered. Longtime owner MWV has managed the site as a pine plantation for years, which involved extensive ditch and drainage systems. Richard Darden, project manager with the Army Corps of Engineers, Charleston District, is reviewing Volvo’s permit application for the site. Berkeley County filed the application on behalf of the company on April 16, under the name “Project Soter.”
“In the end, the pluses outweigh the minuses. More than 2,500 acres are simply off the development table forever.” Norman Brunswig former executive director of Audubon South Carolina
The Army Corps has 120 days from the time a permit is filed to make a decision, which puts the project into August. Darden said the Volvo application was incredibly thorough, which can help streamline the process. The Army Corps is working with Volvo on determining the placement and design of roads and buildings. When reviewing an application, Darden said the Army Corps’ main focus is to find options with the least impact on waterways. He said wetlands provide valuable wildlife habitats, help prevent flooding and impact the quality of water that drains into waterways. It’s a balancing act to find a compromise that enables a project to happen but minimizes environmental impacts, he said. Local and state officials said environmental groups and company officials collaborated to ensure the Volvo project could come to South Carolina. Gov. Nikki Haley said she has seen more collaboration among economic developers and environmentalists in South Carolina this year. “The way the environmental community worked with Commerce to make this success happen, is what I hope continues to be the trend in South Carolina. ... These are two groups that can absolutely work together, but the communication between those groups and the willingness of both those groups really was magic in this deal,” Haley said. Brunswig said that any mitigation plan is difficult for an environmentalist but that he thinks the Volvo project is great for the region and that the automaker will be a good neighbor. “In the end, the pluses outweigh the minuses,” Brunswig said. “More than 2,500 acres are simply off the development table forever and can be enjoyed for generations to come.” cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
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Technical colleges, readySC to train Volvo workforce By Liz Segrist
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olvo officials wanted to see firsthand how South Carolina trains skilled workers for other advanced manufacturers around the state. Before the automaker announced plans to build a plant in Berkeley County, Swedish executives visited the readySC Boeing Training Center at Trident Technical College in North Charleston. ReadySC, a division of the S.C. Technical College System, works with companies to create a training program specific to their needs and equipment. In the past five years, the program has trained more than 4,500 people at 41 automotive companies throughout the state. Volvo visited the 40,000-square-foot training facility and saw candidates learning how to build 787 Dreamliners. Those who excel in the 10-week paid program are hired full time. Gov. Nikki Haley said the success of S.C. manufacturers such as Boeing and BMW, and their ability to find skilled workers through the state’s training programs, was one of the defining reasons Volvo decided to bring a car plant and
4,000 jobs to the Lowcountry. Volvo spokesman Jim Nichols said in an email that the company plans to hire employees for local administration and factory production, which includes work on state-of-the-art robotics and automation equipment. The company did not provide details on specific jobs or wages, or what the plant will produce, though state officials have said the new XC90 and an existing model are possibilities. Officials from Volvo and readySC both said they have not worked out training details yet, such as where it will take place and how long training will take. Susan Pretulak, the S.C. Technical College System’s economic development vice president, said next steps will be meeting with the company to determine the scope of the project, including time frame, positions, qualifications, and needed knowledge, skills and abilities. From there, a customized recruitment and training solution will be developed in step with the company’s construction and production time frame. Barry Jurs, Berkeley County economic development director, said the county plans to build a training center on the Camp Hall Tract site for Volvo. Jurs said
funding for that project will likely come from the state. Successfully training employees to build cars will be a key test of whether Volvo made the right choice in South Carolina. Volvo aims to boost lagging U.S. sales and produce 100,000 vehicles each year with its new plant. “Training is the future of Volvo, and Volvo is the future of jobs for our region,” Jurs said. BMW employees had to show the world that they could build cars in a small Upstate town 23 years ago. Boeing South Carolina employees were under similar pressure when they had to build Dreamliner jets for the first time in South Carolina a few years ago. Commerce Secretary Bobby Hitt said the state will meet Volvo’s workforce needs through readySC. “There were no autoworkers when we announced BMW. There are 8,000 at that plant now. There were no aerospace workers when we announced Vought and later Boeing. Now there are 8,000 there,” Hitt said. “Basically we have a system that can act and react to develop a workforce.” Eleven counties are within a 60-mile radius of the Camp Hall Tract where Volvo will build its facility, providing a
Barry Jurs Berkeley County economic development director
“Training is the future of Volvo, and Volvo is the future of jobs for our region.” large pool of potential employees within driving distance, according to Berkeley County Supervisor Bill Peagler. “This will impact the quality of life for several counties, especially along the I-95 corridor where there hasn’t been significant investment or jobs,” Peagler said. cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
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Infrastructure changes to transform Volvo site into ‘industrial town’ By Liz Segrist
lsegrist@scbiznews.com
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ost of the $204 million incentives package that helped lure Volvo to South Carolina will be used for site infrastructure. The Sweden-based automaker plans to invest $500 million in the Berkeley County site. Santee Cooper’s board voted to buy the 6,800-acre Camp Hall Tract off exit 187 along Interstate 26 and develop it for the future home of Volvo’s U.S. plant. Site owner MWV has managed the site as a pine plantation. The tract is currently covered in trees and is completely undeveloped. It needs water, a sewage system, electricity, site prep work, a highway interchange and rail access. More roads will be built for employees and trucks to access the site. About 2,880 acres of the 6,800-acre site will be used by Volvo as the anchor tenant. Berkeley County plans to eventually own the Volvo portion of the site. The remaining land will be prepped for future industrial projects, Volvo suppliers or future Volvo expansions. “We will build an industrial town along Interstate 26 and populate it with 4,000 people over time,” Hitt said. Among the Volvo incentives, an estimated $120 million will come from state economic development bonds and $30 million will come from state Commerce Department grants. Incentives need approval from the state’s Joint Bond Review Committee, Budget and Control Board and the Coordinating Council for Economic Development. Santee Cooper’s board already approved $54 million in incentives for the project.
Hitt said most of that funding will be used for public infrastructure, including a new highway interchange and roadways to the industrial park. The Commerce Department declined to share details about where the rail line will run and whether CSX or Norfolk Southern will provide access to the site. A rail line runs through Ridgeville, a town about seven miles from the Volvo site. Those tracks would have to cross Interstate 26 to reach the Camp Hall Tract. “Rail is an essential part of the longterm development of the site. ... A strategy is in the works,” Commerce spokeswoman Allison Skipper said. Santee Cooper, Edisto Electric Cooperative, Berkeley Electric Cooperative, the S.C. Power Team and Lake Marion Water Agency will work with Berkeley County to provide water, a sewage system and electricity to the tract. “We wanted to prep the site for any type of business,” Santee Cooper CEO Lonnie Carter said. “It is such a big site. We really needed a large anchor tenant that would make a significant investment going in so the rest of the site could be marketed.” Hitt expects site prep to begin this fall and construction to start in the first quarter of 2016. The first cars are expected to roll off the assembly lines in 2018. In a regulatory filing, the automaker said it wanted to build a plant within 50 miles of an airport and seaport. Both the Port of Charleston and Charleston International Airport are about 30 miles from the site. cr bj
Reach staff writer Liz Segrist at 843-8493119 or @lizsegrist on Twitter.
Port of Charleston critical to Volvo success
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arts will likely be shipped through Port of Charleston terminals and then either trucked or sent by rail to the Volvo site. Cars will be shipped to global markets through the Columbus Street Terminal off East Bay Street in downtown Charleston. That terminal handles break-bulk cargo, which are products that cannot fit into containers. “I look back in hindsight. Had we not invested in Columbus Street as a railroad terminal five years ago, we wouldn’t be sitting here today,” S.C. State Ports Authority President and CEO Jim Newsome said. Newsome said Volvo’s operations will be similar to those of other auto manufacturers using the port. BMW in Greer and Mercedes-Benz in Ala-
bama have been importing parts and exporting cars through the port since 1994 and 1999, respectively. The ports authority is now working with Volvo on logistics details. As more auto manufacturers move cargo through the Port of Charleston, Newsome said the ports authority will eventually need to expand the terminal’s capacity, noting that it does currently have adequate capacity and ship services to serve Volvo. “Manufacturing is a huge multiplier for a port,” Newsome said. “We have an important role in making their supply chain work because automotive really is a just-in-sequence business. They do not store inventory at their plants, so we have to make sure their plants don’t shut down. It’s that critical.”
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DRIVING CHANGE
Following the big win for South Carolina, Gov. Nikki Haley said the real work now begins to ensure the state delivers on all of its promises to Volvo. The Camp Hall Tract has to be transformed from a pine plantation into an industrial campus. New roads, a new highway interchange and rail access are planned for the site. Workforce training programs must be designed and incentives must be approved. Volvo plans for the first South Carolina-built model to roll out of the Berkeley County plant in 2018. The automaker is poised to be a game changer for Lowcountry residents and the state’s automotive sector.
Going the distance
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hen Volvo officials decided to expand the company’s global reach and boost lagging U.S. sales, they looked to the U.S. for their next car plant. They sought a site with a lot of land to house the automotive plant, as well as room to spare if operations expanded or if suppliers located nearby. Volvo also wanted access to major highways, an international airport and a seaport to handle imports of raw materials and parts and exports of cars to global markets.
LOCATION FACTS: • 35 miles from the Volvo plant in Berkeley County to the Port of Charleston • 29 miles to Charleston International Airport • 4,435 miles from the S.C. plant to Volvo’s headquarters in Gothenburg, Sweden. It is a 14-hour flight with two stops from Gothenburg to Charleston.
Gothenburg, Sweden 4,435 miles
Camp Hall Tract Ridgeville CHS Airport
Shanghai, China 7,600 miles
SC Ports
Graphic/Andrew Sprague
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Volvo’s place in the world Sweden
Gothenburg: Head office, product development, design center, marketing, administration, car production Skovde, Floby and Olofstrom: Component manufacturing
Denmark
Copenhagen: Research and development center
Belgium
Ghent: Car production
United States Camarillo, Calif.: Design center Berkeley County: Automotive manufacturing plant; construction begins this fall
China
Shanghai: China headquarters, engineering center, design center Daqing: Manufacturing plant Chengdu: Manufacturing plant Zhangjiakou: Engine manufacturing plant
Malaysia
Kuala Lumpur: Assembly factory
Global employee breakdown as of 2014
Sweden:................. 61% Belgium:................ 16% China:.................... 15% Other markets:....... 8%
Sales by region in 2014:
Western Europe, excluding Sweden: .........................39% Rest of the world (combined markets): ...18% China: ............................17% Sweden: .........................13% U.S.: ...............................12%
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