published Monday, February 8th, 2010

Kia spark plug for revival

WEST POINT, Ga. -- The region 30 miles north of Columbus, Ga., wrestled with a virtual recession for decades, according to local retailers.

Over that time, the West Georgia area near the Alabama state line suffered through the slow, mill-by-mill siphoning of its longtime lifeblood -- textile jobs -- to other countries where production was cheaper.

But with the construction of a $1.2 billion Kia Motors auto assembly plant a couple of years ago, business at Tom Oswalt's shoe outlet in downtown West Point hit record numbers.

"Two years ago, it was the best year we've ever had," he said. "Last year beat it."

The Kia plant started producing Sorento sport utility vehicles in November. Eventually, it plans to hire 2,500 workers to make 300,000 vehicles a year.

Georgia is predicting the nine-county region around the plant will have 20,000 new jobs by 2012.

A comprehensive study by Georgia Tech said Troup County, where the Kia plant is located and which had an unemployment rate of 12.7 percent in December 2009, is in transition.

"By landing Georgia's first automobile assembly plant in decades, it has embarked on a growth path that will transform the county and its surrounding region," the study stated.

  • photo
    Staff photo by Patrick Smith/Chattanooga Times Free Press A car drives down Interstate I-85 near the Kia plant in West Point, Ga. The Kia plant has provided 1,200 direct jobs and is currently looking to hire about 850 more. The plant will eventually have about 2,500 total jobs.

DOWNTOWN BOOST

Downtown West Point, just a few miles from the plant, is undergoing a transformation that will hearten Chattanooga's central city boosters.

Empty storefronts are filling up. Old buildings are undergoing renovation, and new businesses are springing up.

Mayor Drew Ferguson, a dentist born and raised in the city, said the change has been dramatic.

The downtown area once had a number of vacancies, he said, but now the vacancy rate is "practically nil."

David Zachry, owner of Zachry Construction, is revamping an old building in the city's main area that will become new commercial and rental space. Kia is responsible for "a rising tide" of economic opportunities, he said, or "I wouldn't be doing this."

Mitch Green, of West Point, who was taking part in the area's nightlife one day last month, said Kia treats its workers right and has brought a lot of business to the area.

"It's a blessing," he said.

Chris Murphy, of nearby Lanett, Ala., said the automotive industry is seen as "a good career to go into" in the region

"There are a lot of job opportunities," he said, noting that he works for a transportation logistics company.

The Georgia Tech study said thousands of added jobs will boost more work force needs, increasing the need for housing and local government services to handle a larger population in the region.

"When a new manufacturing plant the size of Kia locates in an area, it has a profound impact on the local economy," the study said.

For example, labor compensation in Troup County, Ga., is expected to grow from $72.3 million in 2007 to $303 million in 2012, the study said.

For the nine-county region, the figures balloons from $183.3 million in 2007 to $993.2 million five years later, according to the study.

KIA DRIVING GROWTH

* 20,000 new jobs in nine-county region by 2012

* 50,000 population increase by 2030

* 1,400 new businesses

Source: Georgia Tech

ADDED JOBS

Estimated direct job growth from Kia

* Troup County, Ga.: 5,005

* Chambers County, Ala.: 1,102

* Harris County, Ga.: 610

* Lee County, Ala.: 370

* Muscogee County, Ga.: 350

* Meriwether County, Ga.: 300

Source: Georgia Tech

LABOR COMPENSATION

Increase from 2007 to 2012

* Troup County, Ga: $72 million to $303 million

* Chambers County, Ala: $36 million to $149 million

* Harris County, Ga.: $14 million to $100 million

* Lee County, Ala.: $17 million to $125 million

* Muscogee County, Ga.: $17 million to $103 million

* Meriwether County, Ga.: $9 million to $67 million

Source: Georgia Tech

LANDING KIA

Jane Fryer of the Development Authority of LaGrange, Ga., about 20 minutes north of West Point, said it has been pursuing a diversified economy for a while.

But Kia wasn't on the county's radar screen until the state's economic development agency stepped in and, without saying who, indicated that a major manufacturer wanted large tracts of undeveloped farm land off Interstate 85.

Kia's 2,000-acre site involved 30 parcels and some houses in which people had lived for many years, Ms. Fryer said.

"We were worried about how to present (a proposal to buy their property) to them," she said.

Because there was some uncertainly about the residents' response, the company was asked if it would look at another nearby site, Ms. Fryer said.

Ray Coulombe, economic development manager for LaGrange, said that while officials didn't know it was Kia seeking a plant site early on, they soon received a big hint when a state helicopter showing the site also took them over the Hyundai Motor America plant not too far away in Montgomery, Ala.

Hyundai and Kia are sister companies.

"It was overwhelming to us to see the magnitude of the Hyundai plant," Ms. Fryer said.

Mr. Coulombe said Kia's selection of the original site came pretty quickly in early 2006.

Since that time, he said, Troup County economic developers have made three trips to Korea to woo Kia suppliers.

Ms. Fryer said she's pleased with the number of suppliers the area has attracted so far -- about 10 -- and more are expected to come.

Page Estes, president of the LaGrange-Troup County Chamber of Commerce, said the plant will have long-term benefits that will affect all aspects of the region. Even tourism is expected to be affected as Kia gives public tours of the plant, she said.

West Point's mayor said one key addition to downtown since Kia's announcement is the opening of a Columbus State University campus.

"It has exceeded enrollment expectations," Mr. Ferguson said.

He said it has been his aim to see the area benefit from Kia and its suppliers and make sure opportunities are driven down to the local level.

"I want to make sure we have a solid future," Mr. Ferguson said.

To plan for growth, a master plan for redeveloping the core of the city was aimed at finding places where new people can live, attracting commercial space and raising standards of living, he said.

In addition, the city is looking at redeveloping the Chattahoochee River waterfront that runs through it, the mayor said.

about Mike Pare...

Mike Pare, the deputy Business editor at the Chattanooga Times Free Press, has worked at the paper for 27 years. In addition to editing, Mike also writes Business stories and covers Volkswagen, economic development and manufacturing in Chattanooga and the surrounding area. In the past he also has covered higher education. Mike, a native of Fort Lauderdale, Fla., received a bachelor’s degree in communications from Florida Atlantic University. he worked at the Rome News-Tribune before ...

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