Posted on Sun, Dec. 05, 2004


How South Carolina landed Vought
Sanford’s flight to Alabama aids in luring factory

Staff Writer

NORTH CHARLESTON — The fog was lifting as Gov. Mark Sanford and an S.C. Commerce official walked in the early morning darkness across the tarmac of a small airport last August outside Mobile, Ala.

They could hear cows moo in the nearby pasture as they approached Fairhope airport’s small terminal to meet two Italians. The men were two of the executives who would decide whether greener fields for a new aircraft body plant lay in South Carolina, Alabama, North Carolina Oklahoma or Texas.

At stake was an investment worth at least $560 million and with at least 600 new manufacturing jobs paying around $20 per hour. The average S.C. manufacturing worker earns just under $15 an hour, and Sanford had run in 2002 on a pledge to raise the incomes of South Carolinians, in part by drawing new types of industries to the state.

This, Sanford decided, was the ticket.

Vought Aircraft Industries of Dallas and Alenia Aeronautica of Rome were deciding between North Charleston, Mobile, Kinston, N.C., Tulsa, Okla., and Dallas. The winning site would receive a plant that would make a section comprising about a quarter of Boeing’s new 7E7 Dreamliner, a mid-size passenger jet to be made with new lightweight materials and built using efficient methods borrowed from the auto industry.

Alenia chief executive Roberto Assereto and another Alenia executive had flown from Rome to meet with state officials and tour sites. That Aug. 4 morning they were headed for their next stop: Charleston.

They were expecting a South Carolina government jet to pick them up. They were not expecting the governor to meet them in Alabama.

Soon after Sanford’s flight, Alabama’s fair hope of landing the aircraft body plant evaporated. The state would bail out by September, leaving South Carolina as the sole contender.

By November, the companies’ choice of South Carolina had become obvious. All that was left was last-minute details and Wednesday’s announcement in North Charleston.

The decision followed eight months of daily meetings and correspondence among the companies and S.C. Commerce Department officials.

Commerce Secretary Bob Faith missed the trip to Mobile, but he spent much of the year on his way to meetings in London, Rome and Dallas.

It was one of the biggest deals ever for the department, earning its code name: “Buffalo.”

It was also one of the most complex, involving three companies, a new plane and a state with little experience in the aircraft industry.

But state officials knew a little bit about hospitality, and they weren’t shy about sharing the charms of the Holy City.

Alenia CEO Assereto had never been to Charleston before. During his stay, he and state officials had dinner downtown and explored the city. Vincenzo La Palombara, the Alenia executive in charge of commercial aircraft, had visited Charleston previously but commented that it reminded him of Naples.

S.C. officials felt the city had cast its spell.

A few weeks later, Alabama officials learned the company wanted to cut its minimum job pledge from the 1,000 jobs first discussed to 600 jobs — but without Alabama cutting its incentives.

Neal Wade, director of the Alabama Development Office, flew to Italy and Dallas in early September to meet with Alenia and Vought officials. But when he came back, he recommended to Gov. Bob Riley that the state drop out. The Birmingham (Ala.) News reported Mobile’s loss on Sept. 23.

“As we looked at it from a cost-benefit angle, we could not justify it for the taxpayers of Alabama,” Wade said. “We could not supply a mega-incentive package for 600 jobs. We could not make it work”

Sanford and Faith said South Carolina could not afford to lose it. Faith has said the project’s price tag will be revealed in about a week after details are worked out with the companies, but he said it would be on the scale of BMW’s incentives. Those incentives cost state and local governments $133 million at the time —about $165 million in today’s dollars.

But Faith is betting the incentives will yield much larger investments and jobs than the companies announced Wednesday. Already, Alenia officials have said Charleston would be among their first choices for a new U.S. plant with hundreds more jobs if it wins a contract to build the military’s next-generation cargo plane.

The C-27J contract calls for making 160 to 500 of the cargo jets between 2007 and 2019. It is worth about $5 billion over the 12 years. The military will decide between Alenia and Europe’s Airbus in early 2006.

“Buckle your seat belt, because this is just the beginning. It’s going to be a good ride,” Faith said.

Reach DuPlessis at (803) 771-8305 or jduplessis@thestate.com.





© 2004 The State and wire service sources. All Rights Reserved.
http://www.thestate.com