AVON LAKE, Ohio -- The Ford Motor Co. will move production of a commercial truck from Mexico to here in Lorain County under a $128 million investment, Ford and union officials, and Gov. John Kasich announced Tuesday.
The plant retooling will save 1,400 jobs. The state approved tax credits to allow the transition of medium truck and frame assembly from a plant in Mexico in 2013.
“You've got to really compliment Ford,” Mr. Kasich said. “They had a chance to move to Mexico and they didn't do it. They invested right here in Avon Lake and it's fantastic.” He said the state will see a return on its investment within the first year, based on tax revenues generated by the plant.
U.S. Sen. Sherrod Brown (D., Ohio), whose home is in nearby Avon, issued a prepared statement applauding the news. He also touched on the political issue of Republican opposition to the 2009 taxpayer bailouts that saved Chrysler and General Motors and were supported by Ford, as well.
“While Ford did not require assistance through the auto restructuring, there is no question that letting Chrysler and General Motors go under would have damaged the entire auto supply chain, closing small manufacturers and harming business at the companies that not only sell parts to Chrysler and GM, but to Ford and other car companies,” Mr. Brown said. “When the outlook was bleak, we stood with the Big 3 — and Ohio is reaping new jobs and investments as a result.”
Gov. Kasich has been pressured by Democrats to admit that the bailouts were good policy. Republicans were widely critical of the bailouts, though little is on the record to indicate what Mr. Kasich believed.
“We're all pleased. I'm thrilled with the fact that they've survived,” Mr. Kasich said. “I wasn't voting on that. You can't put me back in time, but I'm pleased with the outcome. I'm really happy these companies are stronger. I think Chrysler now has paid back its loan. I'm thrilled that they have decided that Toledo is really critical. I hope we get more auto jobs.”
Ford now makes its van at the Avon Lake plant in Lorain County but will end that production in 2013 when the successor van, the Transit, begins production in Kansas City, Mo.
Ford United Auto Workers unit chairman Tim Rowe said Ford has been committing to a new vehicle to be produced at Avon Lake in each of the last three four-year contracts.
“This is the first time we had a product announcement,” Mr. Rowe said. “The future here was looking bleak.”
Jim Tetreault, vice president of North American manufacturing for Ford, said the plant re-tooling for the new truck production was made possible by the recently concluded negotiations with the UAW.
“This plant will in-source work from Mexico, how about that,” Mr. Tetreault said. He said Ford has made a commitment to manufacturing in the United States “in a big way.” He said the automaker will add 12,000 jobs in the United States in the next four years.
The incentive package approved by the Ohio Tax Credit Authority was for a 50-percent, 15-year refundable $15 million job retention tax credit for the retention of $58 million in existing payroll.
As part of the agreement the company agrees to maintain operations at the site for at least 18 years. The project is expected to retain 1,400 jobs, although there are now 1,900 workers at the plant.
By comparison, the state approved a 75-percent 15-year job creation tax credit for Chrysler Group LLC when the company committed to create 1,105 jobs at the Toledo assembly plant. The tax credit was valued at $10.2 million.