Arkansas’ ongoing efforts to grow the state’s aerospace and defense sector got a big boost Wednesday (Aug. 15) after Sacramento, Calif.-based Aerojet Rocketdyne unveiled plans to expand the company’s solar-powered rocket motor manufacturing facility in East Camden.
In a press event at the Governor’s Conference room at the State Capitol, Gov. Asa Hutchinson and Aerojet CEO and President Eileen Drake announced that the California defense contractor would invest more than $50 million to expand its sprawling south Arkansas armaments factory and hire 140 new workers over the next three years.
Drake, who along with Lockheed Martin Chairman and CEO Marillyn Newsom, is leading a trend of female CEOs rising to the top in the defense industry, said the expansion in Calhoun County is part of the company’s two-year plan to relocate its Solid Rocket Motor Center from Sacramento to south Arkansas.
“Aerojet Rocketdyne has a very long and successful partnership with state of Arkansas,” said Drake. “For almost four decades we have developed and produced important defense products and capabilities that have helped keep America safe.”
The former General Tire and Rubber Inc. or GenCorp., changed its name to Aerojet Rocketdyne Holdings Inc. in April 2015. Two months later, Drake was appointed to succeed Scott Seymour as president and CEO of a company that has more than 5,000 employees worldwide.
Hutchinson, who spoke before Drake, highlighted his administration’s efforts to grow the state’s aerospace and defense sector, which includes such companies as Lockheed Martin, Dassault Falcon Jet, American Airlines, Pratt & Whitney, and Raytheon.
“I wanted to talk about the importance of the aerospace defense industry to the state as a whole. If you look at this (sector) in Arkansas, it is over a $2 billion industry – and that creates good-paying jobs and has a supply chain that benefits smaller companies across the state,” said Hutchinson.
Hutchinson and Arkansas Economic Development Commission Director Mike Preston also thanked economic development and higher education officials in Calhoun and Ouachita counties for partnering with the state to make the Aerojet Rocketdyne expansion possible. Preston recalled one of his first trade missions to Europe as AEDC chief in the summer of 2015 where Gov. Hutchinson closed an earlier expansion deal with Drake and Aerojet Rocketdyne at the Paris Air Show, one of the world’s largest industrial, aerospace and defense trade shows.
“We sat down then and talk about the long-term prospects of what a partnership with this company and the state of Arkansas would mean and how it has continued to grow over these years,” Preston told the crowd of south Arkansas officials who traveled to Little Rock to attend the press event.
At the time, Aerojet agreed to hire 85 new full-time employees and invested $18 million in new buildings, upgrades, and new equipment at the company’s 630-employee facility in Calhoun County. After Wednesday’s announcement, Aerojet Rocketdyne officials said the company’s employee count will surpass 900, with average annual salaries of $55,000.
“Really, what has come together is that partnership with the talented workforce we have in south Arkansas and a great company recognizing that talent and coming together with (us),” said the state’s chief job recruiter.
Drake and Aerojet Rocketdyne officials last traveled to Arkansas for a similar event in March 2016 when Gov. Hutchinson and more than 200 local and state economic development officials dedicated what at the time was the state largest solar project. That 100-acre, 12-megawatt field includes 151,200 solar panels and supplies supply power to Aerojet Rocketdyne’s 1,200-acre plant in East Camden.
According to AEDC officials, Aerojet Rocketdyne will receive a mix of state and local incentives for expanding the company’s operations in south Arkansas. AEDC’s incentive package includes the state’s Create Rebate program, which provides a seven-year annual cash rebate based a minimum of new full-time hires added to the company’s payroll. Under state law, no benefits may be claimed until a $2 million payroll threshold is met.
The California company, which reported annual sales of $1.87 billion in 2017, will also get a refund of sales and use taxes on the purchase of building materials and taxable machinery and equipment associated with the approved project. Gov. Hutchinson offered the defense contractor $1.3 million – an average of $8,125 per new job – from the Governor’s Quick Action Closing Fund to close the deal on the expansion project.
Last week, Talk Business & Politics reported that Lockheed Martin’s $406 billion F-35 fighter jet program is supporting 400 direct and indirect jobs with a $33.9 million annual boost to the state’s fast-growing aerospace sector.