International firms invest billions in eastern North Carolina
Appeared as a sponsored section in the April 2018 issue of Business North Carolina.
By Kathy Blake
The 41 counties of eastern North Carolina’s Coastal Plain are a diverse region of rich agricultural history, aerospace and military sectors, medical and pharmaceutical collaborations, and 301 miles of oceanfront. Coastline tourism is a billion-dollar industry. Interstate highways, ports and upgraded railways provide access to the rest of the country and the world. A higher education system of universities and community colleges encourages a trained workforce, and residential options range from farmland to small towns to larger cities. Those ingredients are making eastern N.C. an emerging player in a global economy and a preferred location for international business.
North Carolina’s Southeast, a regional economic development partnership based in Elizabethtown, counts 65 different foreign-owned businesses representing 23 countries in its 18-county area. Japan, Germany, England and Ireland lead a segment that accounted for a total announced investment of $4.2 billion in fiscal year 2016. Manufacturing, biotechnology, advanced textiles, construction, and aerospace and defense are among fields in a labor force of 742,000, according to the partnership.
“I think one of our assets in the region is highway connectivity, which has helped us get a lot of FDI (foreign direct investment) activity. For a lot of the companies, the seaport in Wilmington is a driving factor,” says Ryan Regan, marketing project manager for North Carolina’s Southeast. “There are some very tangible assets in our region that work for us versus other places in the U.S. We market our access to the military, in that about 18,000 people exit the military every year, and that’s a huge asset to our workforce capabilities. The military is well-trained, they’re disciplined and they’re familiar with our area. That’s something of interest to international companies that don’t have that asset in their own countries.”
Regan cites a Canadian firm interested in an N.C. location to sell its military-related product. He’s also working with a Mexican company in the agribusiness industry. “They provide products that are used by animal processing companies. They have a major customer in the Southeast region,” Regan says. “They cold-called us, sent us an email, and made a visit here. They are interested in the access to I-95, whereas the port is an asset for the gentlemen from Canada.”
Organizations such as the Economic Development Partnership of North Carolina, Pitt County Committee of 100 Inc. and other statewide development commissions help secure leads and recruit clients.
“It’s been a business area for some time, but we’re about the business of changing people’s perception. People in the Piedmont think the east is a nice, agricultural area you drive through to get to the beach,” says John Chaffee, president and CEO of the NCEast Alliance in Greenville. “We had the recession in ’08 and ’09 when we were involved in textiles, tobacco and apparel, but we have a sizable pharmaceutical area, and we’ve been able to grow on that and bring in the supply chain. About 40 to 50% of our firms that we generate are foreign-based firms. We concentrate on making that pitch.”
Enterprises from China, Australia, South Africa and other global points are recent additions to the landscape, with more on the way. “We have several new foreign firms that have announced investments or new facilities in eastern North Carolina in the last year. Some have gotten a lot of attention, like [China-based] Triangle Tyre, and then we have several small companies that have made the decision to locate in the region, some out of South Africa,” Chaffee says. “One is an automotive-components manufacturer, and the other a food-products company. And that’s a bit unusual — you don’t have a lot of companies from South Africa — and that’s a result of direct collaborations with the NCEast Alliance and the local economic-development offices.”
The Alliance, a not-for-profit economic-development agency that assists companies with expansion and site location, prioritizes marketing the eastern region as economically sound with strong workforce-development programs and logistics in land transportation and port access.
“We’re near the water and near the market suppliers for the East Coast, and we’re a strategic location for the import-export business. We play to our strengths,” Chaffee says.
Those strengths go beyond proximity to the Atlantic. “They’re looking at the workforce, the industry clusters, what we have to offer,” says Wanda Yuhas, executive director of the Pitt County Development Commission in Greenville. The county reports overall industrial investments for 2015-16 of $71.5 million, providing 215 new jobs. “We have a number of international clients who are on our recruitment list now, who have made visits and who are serious about making investments here. In one case, we know we’re the only North Carolina location left. We have significant international traffic now.
“Client activity is brisk for us, and a significant portion is international. In a number of cases, the company is looking at its first U.S. location; in others, the company may only have a location on the West Coast and is seeking an East Coast location. Our clients range from companies from Western Europe to the Far East. The diversity of nationalities as well as the diversity of industry sectors make for a really healthy economy that’s more stable than one that is less diverse. A bonus is having people from many countries and cultures in the Greenville MSA.”
Pitt County’s population increased 32.5% from 2000 to 2016 to the 27th most populous of N.C.’s 100 counties at 175,532 residents. More than a dozen international companies have operations in the area with roots in Australia, Brazil, Canada, Germany, India and Japan. Hyster-Yale Group, which manufactures forklifts and lift trucks, is based in Cleveland, Ohio, and operates all over the world. It has a facility in Greenville.
Specialty pharmaceutical company Mayne Pharma, headquartered in Salisbury, South Australia, with distribution partners in Europe and Asia, recently completed its $80 million, 126,000-square-foot oral solid-dose manufacturing facility in Greenville to give Metrics Contract Services — its contract-development and manufacturing division — a route to triple its worldwide processing capacity.
Mayne Pharma opened its Greenville facility in 2012 and paid $120 million to acquire drug analytics laboratory Metrics Inc. The company anticipates hiring up to 100 scientists, manufacturing personnel and technicians in its expansion, which received a performance-based grant of $550,000 from the One North Carolina Fund. The fund helps local governments attract economic investments.
“Incentives usually play a part in both newly recruited and existing industries,” Yuhas says. “If we didn’t have the skilled workforce, though, we’d never get to the point of talking about incentives.”
Like many area businesses, Mayne utilizes workforce connections with East Carolina University and Pitt Community College and helped develop the curricula at each. “PCC has a simulated manufacturing environment that replicates the production of oral solid-dose medications. The ECU component began with a single class in GMP (Good Manufacturing Practice) over 30 years ago and is now a sophisticated Pharmaceutical Development and Manufacturing Center of Excellence,” Yuhas says. “Both employees of our pharmaceutical companies and students are educated and trained in both facilities.”
International presence, in both company location and training, stretches beyond larger cities.
George Anderson, director of customized training for Edgecombe Community College in Tarboro, grew up in Leggett, a town with a 2016 population of 57, about 7 miles north of the school. “I remember in my youth, we were about 50-50 in industry and agriculture,” he says, but other parts of the state developed faster. “I think our sweet spot is logistics and distribution. Location is everything. We are very rural, but we are right smack in the middle of good infrastructure. So I do expect us to have a lot more growth because of that.”
A block away from the college, Keihin Carolina System Technology, which has locations in the U.S. and Mexico, manufactures car-engine control units in a 147,000-square-foot complex on 60 acres. Corning Inc. announced plans in December to add 428 jobs in North Carolina — 317 in Durham County and 111 in Edgecombe — in the next three years. The Edgecombe project involves an $86 million investment in a warehouse across from the Kingsboro megasite to expand its distribution efforts.
“When I tell people about what’s going on in this part of the state, I tell them we’re on the verge of breaking out. It’s becoming a better place to live and raise a family,” Anderson says. “We’re in a good spot for the future. We’re often overlooked, but we’re ready to go.”
So is Edgecombe County’s Carolinas Gateway Partnership, which after years of preparation landed a major international company in December in Triangle Tyre of China for the 1,449-acre Kingsboro megasite. The site formerly was in the running for several large projects including production for Jaguar Land Rover, which called it “the golden site” before opting to locate in Slovakia. Triangle’s commitment is a $580 million investment that eventually will employ 800.
“It’s a really big deal. It’s one of the largest investments announced for the state of North Carolina, in terms of money and jobs,” Chaffee says, “and for them [the Carolinas Gateway Partnership] to go ahead and reap the rewards of the time they’ve poured into it over the years, it’s nice to see the payoff.”
Oppie Jordan, vice president of the partnership, has been on the front lines of marketing the megasite. “You have to constantly be in front of these people and tell your story, and eastern North Carolina has to continue to do that. And I feel like the Carolinas Gateway Partnership does a great job of that. We’re all team players, and we’re in it together,” she says.
Triangle Tyre will construct two buildings on 400 acres. Headquartered in Weihai, a seaport city in China’s Shandong province, Triangle’s portfolio runs from passenger car tires to heavy-duty commercial units. Kingsboro is its first U.S. location.
“They looked at our site and did a major search all over the U.S., and we were chosen because our site was ready and had the infrastructure in place. We had a lot of competition, and they narrowed it down to North Carolina and Georgia. We were ready. You don’t just win this overnight,” Jordan says.
“We have to be very vigilant and very proactive and use this as an example, a benchmark, that we do have the people, we can train the people through our community colleges, and we have one of the best community college systems in the country.”
Anderson’s customized-training programs already have a tire manufacturing curriculum, designed for the Bridgestone Americas Inc. plant in Wilson, which awards a Career Readiness Certificate and segues to the interview process. “I’ve been in a couple of meetings with Triangle, and we’ll be supporting whatever their skills and training needs may be,” he says. “Some people have actually been to the Weihai campus. They are highly automated, some of the most advanced they’ve ever seen.
“It’s really a fantastic location for them here, halfway up the East Coast and near the ports in Norfolk, Morehead City and Wilmington, and with good roads in between and right on the main artery for rail with the CSX site in Rocky Mount.”
Making a good first impression helped land South Africa-based Stormberg Foods a production facility in a former sandwich shop in Goldsboro, where it plans to create 60 jobs in the next three years. Its main product is a beef-jerky type snack called biltong, which will be marketed under several names. Stormberg received a $125,000 grant from the One North Carolina Fund and a $450,000 building reuse grant for renovations.
“They visited at least three or four times, looking for property and real estate, getting a feel for our residential housing, our school systems, the community,” says Crystal Gettys, president of the Wayne County Development Alliance. “As for jobs, once it gets up and running, it will be a phase-in for their product, with some packaging and management positions, and food-quality positions that they’ll need to obtain. We have them set up with N.C. State and the University of Mount Olive, and NCWorks, so it’s a variety of resources they’ll use to fill those positions.”
Like Wilson and nearby Rocky Mount farther up the highway, Goldsboro is emerging. “It’s not just a pass-through anymore. With the transportation network we have in Wayne County, and the proximity to our ports and the fact that we’re very close to Raleigh, we feel like this will bring more opportunity,” Gettys says. “We’re going to be more than a once-removed bedroom community for Raleigh. I think a big part of our growth is going to be our focus on workforce development for our future, and we have a very robust business retention and expansion program and we can proudly say that we have great relationships and partnerships with our community colleges, universities and public schools. The leadership here is very business-friendly.”
Transportation and proximity are emphasized by NCEast’s Chaffee. “For some companies, it’s a matter of import-export; some others are entrepreneurs who may have grown up or lived near water, so they like being near that. So they’re situated between two sizeable metro areas, the Virginia Beach-Norfolk area to the north and Raleigh-Durham to the west,” he says. “They can choose to fly out of RDU. Plus, we have easy access to I-95 and I-40.”
In the state’s southeastern corner, the Port of Wilmington is expanding its global capacities and in December became the first South Atlantic port to use a USDA Southeast In-Transit Cold Treatment Pilot program, which permits increasing shipments of fruits and citrus. The first cargo arrived in February from Guatemala.
“The biggest thing,” says Regan, whose job entails recruiting trips within the U.S. and across the border, “is that we have a seaport and tremendous highway activity that connects us to a tremendous workforce. That puts us on the map. We have lower costs, so that’s a natural fit for getting a foothold in the U.S.”
Yuhas says that “viewing eastern North Carolina as merely a region to play in is outdated. Our county is serving our state, the nation, and in some cases, the world. Our international community is always ready to help when we’re recruiting companies from their home countries, sharing their experiences and letting prospective residents know that they will be accepted and welcomed. It’s an exciting mix. It makes this a more vibrant and interesting place to live.”