DENSO opens Maryville plant, expects 1,000 jobs

On Friday morning, Kenichiro Ito colored a Daruma doll’s right eye, 14 months after he colored the left one.

One eye of the round, red traditional Japanese doll is filled in at the start of a project; the other, at its completion.

Ito, chairman and CEO of DENSO International America Inc., celebrated completion of Plant 204 on Friday. Fourteen months earlier, he and many of the same officials assembled Friday announced the plant as part of a $1 billion investment in the company’s Maryville complex, adding 1,000 new jobs in an additional 360,000 square feet of factory space.

Production of advanced systems for the transition to electric and autonomous vehicles will begin in spring 2019, according to a company news release.

Workers for the new plant will be hired in phases over four years, Stacy Gallucci of North America Human Resources said at the factory announcement. Basic production jobs start at around $14 per hour, with various skilled jobs bringing more, she said.

According to an incentive agreement with the Blount County Industrial Board, DENSO jobs are expected to pay an average of $26 per hour.

Job seekers can also come to DENSO itself, said Jack Helmboldt, president of DENSO Manufacturing Tennessee. If their applications are not taken on site, they will be directed to the right place.

Dozens of guests milled around Friday wearing blue shoe covers, trying out virtual reality driving simulators and other gadgets while waiting for the ceremony. Eventually the crowd filed to a stage in the middle of the new plant, where DENSO employees already filled many seats. Before the speeches came a video of plant workers talking about safety products and driving technology over a version of Gary Numan’s 1979 song “Cars.”

DENSO, founded in Japan 70 years ago, is now the second-largest automotive parts supplier in the world, Ito said. Half a century ago the company opened a sales office in Chicago, and factories in Michigan and Tennessee 30 years ago. Now it has more than 17,000 U.S. employees, including more than 6,000 in Tennessee, he said.

DENSO chose Maryville as the site for its new plant for three reasons, Ito said: Strong support from Tennessee government, excellent human resources to draw upon and 30 years’ accumulated experience — though he joked Jack Daniel’s and barbecue were also decisive factors.

Plant 204 represents most of DENSO’s promised $1 billion investment, but the rest is in projects underway elsewhere on the Maryville campus, including products for hybrid electric vehicles, Helmboldt said.

All of the expansion projects now underway won’t be finished until late 2021, but so far DENSO is ahead of schedule, he said. Ultimately they will probably result in more than the promised 1,000 jobs, Helmboldt said.

Gov. Bill Haslam said DENSO has invested $3 billion in the state during his administration. He credited the work of local DENSO employees for encouraging the company to further expand here. That investment and job creation results in tax revenue, which enables the state to solve other problems, he said.

U.S. Sen. Lamar Alexander, R-Tennessee, said in the 1980s Tennessee secured Nissan and Saturn factories but lost a Toyota plant to Kentucky. A few months after those announcements, however, a Toyota official told him there was a “small consolation prize for your hometown” — a parts supplier which would bring about 100 jobs.

That turned out to be DENSO, and those 100 jobs turned into thousands.

Blount County Mayor Ed Mitchell said he walked the original DENSO site 30 years ago with other officials and company executives, never imagining what it would become.

“This was a dream,” he said.

Dozens of people were involved in promoting the campus’ development who deserve to be remembered and thanked, Mitchell said. He recited a long list of names, some present Friday, some not.

Alexander, Haslam and Helmboldt joined Ito as he used a black marker to fill in the doll’s left pupil, and they all signed the doll’s head before returning to the stage for a quick ribbon cutting.

The state is providing a $20 million economic development grant, Tennessee Economic and Community Development Commissioner Bob Rolfe said.

Local authorities provided a six year tax abatement, estimated to be worth $14 million, and a $2.2 million job training grant, said Bryan Daniels, Blount Partnership president and CEO.

Even after the tax abatement, the development is expected to generate $31.5 million in new property taxes over the same six-year period, Daniels said.

Tennessee Valley Authority also apparently offered incentives, but TVA typically does not reveal what it provides.

According to an incentive agreement with the Blount County Industrial Board, DENSO jobs are expected to pay an average of $26 per hour.

In April, Ford announced it would wind down North American production of all but two car models, and in October that it would cut an unspecified number of its 70,000 salaried jobs. In November, General Motors said it would shut down five North American plants and cut 14,000 jobs.

The effect of those cutbacks on DENSO’s business is still being evaluated, Helmboldt said.

“It’ll surely have an impact,” he said.

Source: Knoxville News Sentinel, by Jim Gaines

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Published December 20, 2018