Mohawk Industries to build $180 million tile plant in Tennessee

Mohawk Industries to build $180 million tile plant in Tennessee

March 7th, 2014 by Ellis Smith in Business Around the Region

Jeff Lorberbaum, chairman and chief executive officer of Calhoun, Ga.-based Mohawk Industries, announced that the company would build an $180 million plant in Dickson County, Tenn. The new plant, which will open in the fourth quarter of 2015, will employ 320 workers when complete.

Photo by Contributed Photo/Times Free Press.

Mohawk Industries, the world's largest flooring manufacturer and biggest tile manufacturer in North America, will build a $180 million ceramic tile plant in Dickson County, Tenn., to meet growing demand for hard surfaces here in the U.S.

The Calhoun, Ga.-based company announced the proposed 1.4 million-square-foot plant on Thursday. Mohawk said the facility will employ 320 workers in the production of Dal-Tile, Marazzi, American Olean, Mohawk and Ragno brands.

When Mohawk's ninth ceramic plant in the U.S. is fully operational within four years, the company's global tile production capacity will exceed 2 billion square feet annually. The plant should open in the fourth quarter of 2015.

"As the U.S. economic recovery gains momentum, our ceramic business is well positioned for additional growth as a result of our innovative, stylish products," said Jeff Lorberbaum, chairman and CEO of Mohawk Industries

The announcement comes on the heels of the completion of Mohawk's $1.5 billion purchase in 2013 of leading Italian tile manufacturer The Marazzi Group, as well as purchases of a handful of other flooring manufacturers. The new Tennessee plant could supplement production in Italy and elsewhere in the world.

Mohawk's new plant is the latest in a series of moves by flooring manufacturers in recent years to produce products for the U.S. domestic market within the country's borders, reversing the trend of outsourcing that prevailed for the last several decades. In part, the moves are a response to fast-growing sales of hard flooring surfaces, which have long outpaced soft carpet sales internationally.

A decision to build new plants here also takes advantage of marginally lower labor costs in the U.S. compared to Europe and elsewhere, increased quality control and lower shipping expenses.

Though carpet sales continue to rebound from their 40 percent decline in the last few years, homeowners and multi-family complexes have greatly expanded their use of more resilient materials such as ceramic tile, hardwood and laminates to save on labor-related replacement costs. Ceramic tile is the fastest-growing flooring product category, according to Mohawk.

"We continue to invest in leading-edge facilities that improve our manufacturing efficiencies and create new product collections that reinforce our position as the preferred provider for thousands of customers," Lorberbaum said.

Tennessee Gov. Bill Haslam, who cheered Mohawk's decision to locate in Tennessee rather than the traditional flooring capital of Northwest Georgia, said that the Volunteer State's business-first philosophy contributed to the manufacturer's decision.

"Mohawk's decision to build a new production facility and distribution center in Dickson is another example of the business-friendly climate our state offers to companies around the world, and it reinforces our goal to make Tennessee the No. 1 location in the Southeast for high-quality jobs," Haslam said.

Mohawk also has a habit of locating its plants in diverse geographic areas, which can reduce dependance on any single workforce or state government and take advantage of different supply chains.

"In addition to the company's northwest Georgia facilities, Mohawk operates manufacturing plants in more than a dozen states," said Robert Webb, senior director of public affairs for Mohawk. "The manufacturing component of the Dickson facility will benefit from access to local raw materials. Also, the facility's distribution center will enable shorter deliver delivery times to most major eastern U.S. markets."

John Turner, Jr., president of Dal-Tile, said the combination of new technology, central location and skilled workers would support Mohawk's leading position in the flooring market.

"The new facility provides us with a number of key advantages, including the quality of the local workforce, access to raw materials and an ideal location from which we can ship to a majority of the U.S. population quickly and efficiently," Turner said.

Dickson County has worked for two years to plan and negotiate incentives to attract Mohawk to the area, said Bob Rial, mayor of the county. The deal is the largest investment ever in Dickson County, though terms of the incentives package were not disclosed.

In addition to the county, the city of Dickson, TVA, and the Tennessee Department of Economic and Community Development also worked to secure Mohawk's decision to build in the Dickson County Industrial Park.

Contact staff writer Ellis Smith at esmith@timesfreepress.com or 423-757-6315.