By MIKE GEORGE and ANNIE GOELLER, Daily Journal of Johnson County staff writers
The population of an Alabama town nearly doubles every day when people come to work.
When Honda announced it was building a plant in Lincoln, Ala., a town with a population of about 4,800, local officials expected more jobs.
What they didn’t know when the building was completed in 2001 was that there would be a fivefold increase in jobs during the next five years.
More than 4,500 employees work at the $1.2 billion plant. And along with those workers came another 4,000 jobs at 74 companies that supply the plant with equipment and parts.
Before Honda came, almost none of those companies existed in Alabama.
Now, they are clustered in about 10 counties around the plant, employing thousands of workers and bringing money to local communities. After Honda opened, a $1 billion Hyundai plant opened in the state.
Many of those communities are within 30 to 50 miles of the main Honda plant. Johnson County lies within that range of a plant planned for Greensburg.
If Johnson County economic development leaders want to land some of the spin-off businesses, they must be ready to market themselves and make sure to have highway access, Honda and Alabama officials said.With a new $550 million Honda plant coming to Greensburg, Johnson County workers have a less than one hour drive to 2,000 new jobs.
And at least three Franklin companies that supply Honda with parts could see a boom, meaning more jobs for local workers, too.
Interstate access is crucial for the suppliers that ship materials to the plant, said Edward Miller, senior manager of public relations for Honda of America.
That means Johnson County companies and workers will need a quick route to Interstate 74, not the current way through winding country roads.
Alabama officials warned Indiana: Honda officials underestimated when they came to Lincoln, so be prepared for an increase in the workers and suppliers needed.
Small town, big impact
When Honda selected the Alabama site in 1999, officials estimated it would bring about 1,500 jobs with an investment of about $425 million. After an expansion in 2002, the plant employs 4,500 for a $1.2 billion investment.
As the company grew, the supplier base grew, too, said Don Hopper, executive director of the Calhoun County Economic Development Council.
The 74 companies that were moving into the area needed information about the schools, housing and the community for their future workers.
Local economic development officials had to be ready.
In many cases, the suppliers chose to move to the area without much persuasion from local officials. But that didn’t mean officials could just sit back and wait, said Mike McCain, executive director of the Gadsden-Etowah County Industrial Development Authority.
When Honda officials and suppliers went shopping for locations in his area, he was ready with a list of available properties and land and information about the local communities, such as income levels, schools and attractions in the area, McCain said.
“We were proactive, but it was also good to be aggressively reactive when Honda officials started looking around for potential areas for their suppliers,” he said.
In Talladega County, where the plant was built, the county had to widen some highways leading to the plant and provide better interstate access to the plant, said Calvin Miller, director of the Talladega County Economic Development Authority.
What it means for Indiana
Potential for new suppliers might not be the focus in Indiana, but current ones could expand.
For example, in Talladega County, local, existing businesses have seen a boom, such as office supply companies and a foam company located in the county, Calvin Miller said.
One of the reasons Honda officials chose Greensburg for the plant was because of the proximity of parts suppliers in Ohio, said Edward Miller, the Honda spokesman.
Honda in Greensburg is expected to generate $1.5 billion in new business with suppliers, with about $900 million in Ohio, he said.
The company already has 64 suppliers in Indiana.
Some local suppliers will expand and some may look for new, larger facilities to make room for increased production, he said.
Honda keeps long-term relationships with suppliers.
“Trying to get into the Honda family isn’t necessarily an easy thing to do,” he said.
But the company also hires new suppliers every year, meaning Johnson County can still fight for new companies as well as more business for current suppliers, Edward Miller said.
What Johnson County needs to do
Regardless of whether Honda already has suppliers in the area, communities need a range of locations available for businesses, McCain said.
“The most important thing for local communities is to be prepared,” he said.
Some companies will need open land to build a plant large enough for specialized equipment needed to make their products. Others, such as those that make general products, will only need an empty facility they can move into, McCain said.
Any communities near the Honda plant should have a good business plan, sites ready for any prospective businesses and be prepared for discussions with companies, Edward Miller said.
In Talladega County, large employers don’t often build in the Lincoln area because they don’t want to compete with the plant for a work force. Instead, the companies sprout up outside of Lincoln and in surrounding counties.
That means counties outside the area for the new plant should be ready to meet with suppliers and potential suppliers.
Some companies, especially some of the largest suppliers, are steadily shipping parts to Honda plants to keep up with production. Those plants need to be near enough to transport items quickly but also need a good shipping system, such as rails or highways, Miller said.
Communities need to be prepared to widen or improve roads and be sure to have good interstate access, he said.
“Because of the need for good and fast shipping, access to interstates is pretty much a given,” he said.
Communities near each other shouldn’t compete for business.
Honda officials like to see welcoming cities, towns and counties who work together to attract business to their area, Morrison said.
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