Third delay for Kumho’s US plant
Media reports in the US indicate it may be third time unlucky for Kumho Tire’s planned factory in Bibb County, Georgia. Macon-based newspaper The Telegraph states work on the US$225 million plant has been placed on hold for a third time, a move that allegedly has prompted local economic development officials to rethink the entire project’s future and mull over the prospect of putting the greenfield factory site back on the market.
According to The Telegraph, the office of Georgia governor Nathan Deal confirmed he was informed of the delay while meeting Kumho officials in South Korea in October. “All we can really say is we do know it’s on hold, and it might be a span of a couple of years,” said Stephanie Mayfield, speaking on behalf of the governor’s office. “Kumho reiterated to the governor its commitment to the project.”
Despite soothing words regarding the tyre maker’s long-term intentions, this third delay in the project has been met with concern by the Macon-Bibb County Industrial Authority Properties Committee; committee chairman Cliffard Whitby told The Telegraph it may soon need to decide whether to extend incentives used to bring Kumho to the region.
“It’s essentially boiling down to the shape of the economy worldwide and a business decision they have to make,” he said. “We’ve got to look at this and make some determinations on what’s in the best interest of the community.” Whitby clarified that this involves deciding “whether or not we’re going to accept another delay under the terms that we originally had agreed to.” Total incentives offered to Kumho include a 20-year tax abatement and job tax credits, plus a $3.9 million grant.
“That just simply goes to whether it’s in the community’s best interest or whether we think we can open that site up to other prospects,” he continued. “We’ll make some determination on what our posture needs to be, because at the end of the day what we’re looking at is we’re tying up a prime piece of property and it’s not available to potential prospects coming up.”
Pat Topping, senior vice president of the Macon Economic Development Commission, views the situation more optimistically. He has spoken with Kumho officials several times this year and while conceding the economic climate has changed since the project first began, he said “I think Kumho has every intention of moving forward with the project. We just hope the economic situation allows them to go forward.”
Kumho originally signed an agreement to build a tyre factory in Bibb County back in January 2008, yet in October that year further work on the project was put on hold due to the economic downturn. It began again early the next year, only to be shelved in October 2009. In July this year the tyre maker announced that work on the project, which previously was expected to get underway in late 2013, would begin mid-2012.