Mitsubishi deal to boost Chaffee prospects; help Crawford County

story by Marla Cantrell
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Getting an agreement from Mitsubishi Power Systems America to come to Fort Chaffee is a lot like getting engaged. You’re 99 percent sure the wedding will happen, you’re just waiting on the license to make it official.

But none of that bothers Ivy Owen, Fort Chaffee Redevelopment Authority Executive Director. He feels sure the Japanese wind turbine manufacturer will go through with its plan to build a 200,000 square foot facility, which will cover 90 acres of Chaffee land.

“I don’t think they’d ever make the announcement if they didn’t feel comfortable with everything. We worked on it every day for 16 months,” Owen said.

Mitsubishi is planning to invest $100 million and bring 400 jobs to the area. Construction should begin by 2011 and take 18 months to complete. Owen did not have a breakout of how many of those positions would be for managers and administrative staff. He did say the jobs inside the plant won’t be typical manufacturing work.

“This will be a fairly technical operation. As far as repetitive production type factory jobs, this is not going to be anything like that,” Owen said.

The direct and indirect investment the company is expected to bring to the area is significant. Suppliers should begin to set up shop once Mitsubishi begins construction. Owen can’t predict how much business that could generate, but thinks it could help the entire region. Eventually, Owen said, some of the growth should spill across the river. And that’s the move Crawford County Judge John Hall has been waiting for.

“We think Chaffee Crossing is going to be the first area to come to the fore. After Chaffee, I think you will see development over on the Crawford County side … We have a lot of land over here that’s good for development,” Hall said.

One of the main drawing points for Mitsubishi was the number of local people already trained to work in the manufacturing sector. The company is willing to pay for that experience, with Owen suggesting that Mitsubishi wages would be higher than the average manufacturing wage in the area.

Once the staff is in place, Mitsubishi workers will handle massive pieces of equipment. The facility will make the hub of the turbine, which will weigh 120 tons. It will be dissected into four pieces before being shipped out.

The Japanese company will join four other large manufacturers on Chaffee land. Owen estimates there will be 1,500 people working in that one small area of Chaffee once Mitsubishi is up and running.

Here’s how those numbers add up:
• Currently, Graphic Packaging employees 450 people.
• Mars Petcare should have 250 workers when all its lines are running.
• Umarex USA, which will manufacture a new line of handguns at Chaffee, is expected to open in March of next year. It will employee another 100.
• Pradco, a manufacturer of fishing lures, will have a staff of approximately 300. Work on that plant should begin in June of 2010.
• Mitsubishi is set to hire 400 workers. Construction should begin in 2011.

Owen said getting companies of this caliber will lure others to the area. Right now, he’s talking to two or three other businesses that are seriously considering the move, although he declined to name them.

As for Mitsubishi, Owen thinks Chaffee is smart to get in on the ground floor of the current push for green energy. He cited federal tax breaks, along with state incentives, as proof there is a vital market for wind turbines.

The U.S. Department of Energy’s Web site supports his position.

“After reaching 1,000 MW of wind energy in 1985, it took more than a decade for wind to reach the 2,000-MW mark in 1999,” according to the DOE. “Since then, installed capacity has grown to 28,635 MW (as of April 30, 2009). Today, U.S. wind energy installations produce enough electricity on a typical day to power the equivalent of more than 6.5 million homes.”

The American Wind Energy Association reported Oct. 20 that total wind capacity in the U.S. as of Sept. 30 was more than 31,000 MW — enough to provide electricity to the equivalent of 9 million homes.

More than 70 wind-energy manufacturing plants opened, expanded or announced in 2007 and 2008, with 55 of those in 2008. A factor in this growth is that 50% of parts used in North American wind energy are now manufactured in the U.S., up from 30% in 2005.

One of those announcements included a $100 million plant wind-turbine manufacturing plant to be built in Jonesboro by Nordex. The company, based in Germany, announced July 20 it would build the plant with full production — and 700 employees — gearing up in 2012.

LM Glasfiber announced in July 2007 it would build a $150 million windmill blade production plant in Little Rock that would eventually employ 1,000. The first blade rolled out of a temporary manufacturing site in Little Rock in early 2008.

But not all is sunshine and fair winds in the sector. Concerns about continued subsidization of clean energy by the U.S. government, the recession and tough global credit markets have resulted in a pullback by some wind energy companies. Citing a slowdown in orders, LM Glasfiber, a Danish company, announced in June it would lay off about 80 from its windmill blade production plant in Little Rock. The company employed close to 400 prior to the layoff. This followed a March announcement in which LM Glasfiber laid off 725 workers from its European workforce of 3,800 because of delays in European wind projects.

Also, there is opposition to the turbines. Some argue that because wind energy can’t be stored for later use, traditional sources of power like coal and electricity must be available for the times turbines aren’t running. That can make turbines costly propositions. And just this year, The Minnesota Department of Health published a study on the possible negative health effects for those living near wind farms, especially from the noise the turbines produce.