All posts by Matt Ellis

Piston Automotive Set to Expand Louisville Operation

Gov. Matt Bevin announced auto components supplier Piston Automotive LLC will invest $1.5 million for an expansion of its Louisville operation, which will create 50 full-time jobs.

“Kentucky’s automotive industry is firing on all cylinders, and we continue to see steady growth from OEMs and suppliers alike,” Gov. Bevin said. “Piston Automotive has enjoyed success with its Louisville operation over the past eight years, and we are excited to see it culminate in this expansion. We are grateful for Piston Automotive’s commitment to the commonwealth, and we look forward to seeing the company continue to accelerate their business into the future.”

Piston Automotive will purchase new equipment to be installed at its existing facility on Technology Drive in Louisville. The project will allow for the installation of a new production line and increased capabilities to support new market demand. Piston Automotive has operated in Louisville since 2011, where it currently employs 85 people.

“Our investment in the Louisville facility is a direct result of growth with one of our key customers, Ford, the support we’ve received from the community and the hard work our employees have put in to make Piston Automotive successful,” said Piston Group Chairman and Founder Vinnie Johnson. “We are thankful for the state’s confidence in our ability to grow and become a bigger provider of jobs in Kentucky.”

Piston Automotive is one of four entities – along with Irvin Products, Detroit Thermal Systems and AIREA – of parent company Piston Group LLC, headquartered in Southfield, Mich. Piston Group was founded in 1995 by industry magnate and former NBA champion Vinnie Johnson, and is one of the largest African-American-owned automotive suppliers in the United States. Today, Piston Group employs nearly 10,000 people at more than 20 locations across the US.

Rep. Jerry Miller, of Louisville, said the automotive industry is thriving in Kentucky, especially in the commonwealth’s largest city.

“With both this exciting news and Ford’s recent announcement that they will be increasing their vehicle production, it is clear that the automotive sector is growing rapidly in Louisville,” Rep. Miller said. “Piston Auto’s million-dollar investment and creation of 50 new jobs will put more people to work and add to our city’s economic livelihood, and is a testament to the pro-business policies coming out of Frankfort.”

To encourage the investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) on Thursday preliminarily approved the company for tax incentives up to $700,000 through the Kentucky Business Investment program. The performance-based incentive allows a company to keep a portion of the new tax revenue it generates over the agreement term through corporate income tax credits and wage assessments by meeting job and investment targets.

In addition, Piston Auto can receive resources from the Kentucky Skills Network. Through the Kentucky Skills Network, companies can receive no-cost recruitment and job placement services, reduced-cost customized training and job training incentives.

For more information on Piston Auto, visit www.PistonAutomotive.com.

A detailed community profile for Jefferson County can be viewed here.

Ford Boosts Production for Expedition, Adds 550 Jobs to Meet Demand, New Advertising Touts SUV’s Capability

Ford Motor Company will again boost production of its hot-selling Ford Expedition and Lincoln Navigator this summer as both vehicles continue to gain share over their competitors in the large SUV segment.

Surging demand for Expedition and Navigator is driving an increase in production of 20 percent at Ford’s Kentucky Truck Plant in Louisville. Retail sales of the Expedition eight-passenger SUV surged 35 percent and it gained 5.6 percentage points in market segment share last year. Expedition’s average transaction price increased $11,700 and is now $62,700. Navigator sales grew 70 percent in 2018 from 2017, to 17,839 sold, giving Navigator its best sales year since 2007.

“Kentucky Truck Plant is home to two of Ford and Lincoln’s most successful vehicles,” said John Savona, Ford vice president, North American manufacturing. “After seeing a continued increase in customer demand for Expedition and Navigator, we are boosting production for a second time to meet it.”

To produce even more Expeditions and Navigators, Ford has increased the line speed at Kentucky Truck Plant. The manufacturing team gathered a group of salaried and hourly workers together to analyze the cycle times of each operation and found there were jobs that could not be completed in the allotted time. So they added more workstations and split up some tasks to ensure employees can complete jobs with quality craftsmanship and in the time allotted.

The plant team also had to get creative in its use of space, adding pits and platforms so more line operators working in the same area can execute tasks while complying with varying height requirements as the vehicle moves down the assembly line.

More jobs for Kentucky Truck Plant

All of this translates into a need for more people to build these popular vehicles.

So Ford is adding 550 jobs at Kentucky Truck Plant and moving approximately that same number of jobs from Louisville Assembly Plant to increase Ford Expedition and Lincoln Navigator production by 20 percent. Vehicle production will increase after the summer shutdown in July.

New ad campaign ‘out-bigs’ the competition

While Expedition sales continue to grow, Ford is launching a new marketing campaign to build further awareness of Expedition’s class-leading features and capabilities, including more driver-assist technology than any vehicle in its class, best-in-class second and third row legroom, best-in-class towing and more. New “Better Big” TV commercials debut this week, highlighting Expedition’s key features and capabilities.

“We ‘out-big’ the competition where it counts – towing, interior space and technology,” said Matt VanDyke, Ford director, U.S. marketing. “Our team completely rethought every inch of Expedition, and its growing sales reaffirm we hit the sweet spot with today’s full-size SUV customers. Now, our new ‘Better Big’ marketing campaign will bring this to life for new buyers.”

While growth remains strong with Baby Boomers and Gen Xers, the latest customers include a greater number of older Millennials – a 5 percentage point increase – who now make up 14 percent of Expedition buyers.

“Expedition is winning with a whole new group of customers, first-time homeowners who are starting new families, including the oldest Millennials,” said VanDyke. “These customers crave roominess, capability and technology that make their lives easier – attributes that can only be found in the Ford Expedition.”

The television spots, voiced by acclaimed actor Bryan Cranston, build upon the Built Ford Proud campaign by championing Ford’s largest SUV in all its eight-passenger, best-in-class 9,300-pound trailer-towing, vista-roofed glory. Ads include:

  • Leave No Man Behind: A look at Expedition’s seating for eight people, including room for adults in the third row, as well as its ability to tow a two-horse trailer.
  • Better Big: Highlights Expedition’s class-leading roominess and interior space.
  • Curtain: A 30-second tribute to Expedition’s sunroof – the largest in its class.

Ford will also promote Expedition during this year’s American Country Music Awards in April. Eight specially selected fans will drive around Las Vegas in the 2019 Expedition singing ACMA-nominated songs. The show will broadcast the reaction of the artist whose song was featured.

The new ads highlight Ford’s onslaught of new vehicles in the hot-selling SUV and truck segments, including the all-new Ford Ranger on sale now and the all-new Ford Escape and Explorer coming later this year.

Toyota to Add Hybrid Version Production of RAV4 and Lexus ES in Georgetown

Gov. Matt Bevin today joined Toyota Motor Manufacturing Kentucky Inc. executives and local officials to announce a $238 million investment to add production of two models at the Georgetown plant; the Lexus ES Hybrid and RAV4 Hybrid.

“Toyota has been a remarkable corporate partner to the commonwealth for the past 30 years, and we thank the company for its continued commitment to Kentucky,” Gov. Bevin said. “We are immensely proud that the Bluegrass State is home to Toyota’s largest manufacturing operation, and we enthusiastically support this substantial investment to address the rising demand for hybrid vehicles. This significant announcement puts the company in position to better serve its customers for years to come, and we look forward to Toyota, Scott County and Kentucky continuing to grow together.”

TMMK leaders plan to begin Lexus ES Hybrid production in May with capacity of 12,000 units. In fall 2015 the plant became the first US facility to produce a Lexus vehicle when TMMK assembled its initial ES 350. The Hybrid version is currently made in Japan. RAV4 Hybrid assembly is expected to ramp up in January 2020 with a capacity of approximately 100,000 units per year.

The investment is part of Toyota’s effort to boost production at its facilities throughout the US. Including the new production lines at TMMK, Toyota plans to invest nearly $750 million across five production facilities. Those include Toyota Motor Manufacturing Alabama, Toyota Motor Manufacturing West Virginia and Bodine Aluminum operations in Tennessee and Missouri.

“Today’s exciting announcement shows Toyota’s recognition and continued trust in the high-level skills and expertise of our fantastic team here in Kentucky,” said Susan Elkington, president of Toyota’s Kentucky facility. “The production changes announced today are centered upon our commitment to meet changing customer desires by diversifying the types of products our team members build here in Georgetown. This is also a further testament to Toyota’s long-term commitment to Kentucky and our team is excited about what these changes mean for the future of our facility.”

Announced in 1986 and opened in 1988, TMMK is Toyota’s largest production facility globally and currently employs approximately 8,000 team members. Its team members currently assemble the Camry, Camry Hybrid, Avalon, Avalon Hybrid and Lexus ES models. Additionally, team members assemble four-cylinder and V6 engines, axles and steering and engine components. The new hybrid models will not change the plant’s current capacity of 550,000 vehicles annually.

Kentucky’s automotive industry includes 520-plus facilities, employing more than 100,000 people full-time. The Georgetown plant has been a major factor in Kentucky attracting nearly 200 Japanese-owned manufacturing, service and technology-related facilities, located throughout the state. Those Japanese-owned facilities employ nearly 47,000 people full-time.

“There is no question of the positive impact Toyota has had on Kentucky over the past three decades. From the growth of the commonwealth’s automotive sector to the company’s efforts to give back to the local community, we in Kentucky could not ask for a stronger relationship than the one we share with Toyota Motor Manufacturing Kentucky,” said Terry Gill, secretary of the Kentucky Cabinet for Economic Development. “The automotive industry is constantly evolving, and we are seeing a company with the foresight to stay a step ahead of that evolution. This investment serves as a reminder of Toyota’s importance to the state’s economy and we look forward to a continued partnership for years to come.”

For more information on TMMK, visit https://www.toyota.com/usa/operations/map.html#!/USKY

A detailed community profile for Scott County can be viewed here.

Kentucky Breaks Export Record in 2018

Gov. Matt Bevin announced today Kentucky exports reached an all-time high for a fourth consecutive year with $31.76 billion in goods and services shipped abroad from the commonwealth in 2018, a 2.9-percent increase from the previous year.

“Once again, Kentucky’s record-setting exports highlight the momentous economic progress we have achieved in recent years,” Gov. Bevin said. “Our rapidly expanding trade is the result of steps we have taken to create a robust business climate and to market Kentucky excellence to a global audience. The quality of Kentucky-made products is unmatched, and more and more people around the world discover this fact every year. We have cultivated some outstanding international relationships over the past three years, and we will continue these efforts as we build upon our commonwealth’s strong and dynamic reputation.”

Consistent with the past several years, aerospace products and parts took top-category honors in 2018, according to data recently released by the U.S. Census Foreign Trade Bureau and WISERTrade. The industry shipped nearly $12.5 billion in products to other countries last year, a 7.1-percent increase over 2017. Aerospace-related exports skyrocketed more than 60 percent since 2014, when the industry sent about $7.8 billion in products and parts across borders.

Motor vehicles (more than $3.1 billion in exports), pharmaceuticals and medicines (nearly $2.3 billion), motor vehicle parts (about $1.5 billion) and resin, synthetic rubber and artificial and synthetic fibers and filament (more than $1 billion) rounded out the top five categories. Notably, pharmaceuticals leapt 22.4 percent over the previous year. The industry nearly doubled its export totals since 2014, when Kentucky shipped out more than $1.2 billion of pharmaceuticals and medicines.

Canada retained its spot as Kentucky’s top export destination, importing more than $7.7 billion in goods and services. France (more than $3.3 billion) jumped to second on the list, with Kentucky increasing exports to the country by nearly 13 percent as compared to 2017.

The United Kingdom (nearly $3 billion), Brazil (nearly $2.5 billion) and Mexico (about $2.3 billion) make up the rest of Kentucky’s top five 2018 export destinations. China, after making a drastic leap in 2017 to become Kentucky’s No. 4 trade partner – its first year ever as a top-five export destination for the state – imported the sixth most Kentucky products by dollar value (nearly $2.2 billion) in 2018.

Kentucky’s exports again held up well nationally, placing 17th among all states and Washington D.C., despite having just the 26th largest population in the US.

Since taking office in 2015, Gov. Bevin and the Cabinet for Economic Development have strongly emphasized the importance of strengthening Kentucky’s international ties. Since February 2018 alone, Kentucky delegations went on trade missions and business trips to Germany, Austria, Hungary, Japan, South Korea, China, the United Kingdom and, most recently, a US delegation trade mission to India led by Gov. Bevin. 

“One of our primary objectives has been to ensure no other state outhustles Kentucky. That approach has paid dividends, as we have seen yearly growth in international trade and increased interest from foreign countries wanting to invest in Kentucky,” said Vivek Sarin, executive officer & co-CEO of the Cabinet. “We fully intend to move forward with this strategy to expand Kentucky’s reach even further, build new business relationships abroad and create new opportunities for Kentuckians.”

Kentucky now has more than 500 internationally owned facilities, which represent 34 countries and employ nearly 112,000 people in total. Terry Gill, secretary of the Cabinet, said Kentucky has made great strides but will not stop with these accomplishments.

“We have invested a great amount of time and effort on international growth, and these record exports and increased foreign direct investment demonstrate that those efforts, along with the state’s outstanding logistics capabilities, have resulted in great progress,” Gill said. “While we are proud of these strides Kentucky has made, we have only just begun to realize the potential that is out there. We will continue to show the world Kentucky is a premier location for businesses while promoting the commonwealth’s excellent goods and services.”

Kentucky businesses can learn more about export opportunities and make connections with export markets through the Kentucky Export Initiative. KEI brings together a coalition of business organizations, trade experts and government entities, including the Cabinet for Economic Development, with a focus on increasing Kentucky exports to create new jobs and diversified markets for the state’s products. Learn more about KEI at www.KYExports.com.

Auto Parts Maker DAE-IL Breaks Ground on 120-Job Facility in Murray

Gov. Matt Bevin today congratulated leaders of South Korea’s DAE-IL Corp. and the Murray community as officials broke ground for the company’s $50 million, 120-job automotive parts plant in West Kentucky.

“We are grateful for DAE-IL’s decision to build its first US manufacturing facility here in the commonwealth, and we congratulate them on starting construction in Murray,” Gov. Bevin said. “Kentucky has a proven track record of successfully attracting and integrating businesses into our economy, and our relationship with another South Korean company set the stage for this opportunity. DAE-IL’s significant investment will create great jobs for citizens of Calloway County and West Kentucky, and we are confident that they will thrive and grow in the commonwealth.”

Company leaders expect the 295,000-square-foot plant, being built in the Murray-West Industrial Park, to open in May 2019. Employees at the new facility will manufacture automotive transmission gears.

“We are very happy and excited to be in Murray. We would like to thank everyone that has played a part in this,” said DAE-IL President and CEO Johnny Kim. “They have made us feel very welcomed here. We look forward to a long, successful partnership with the community.”

Founded in 1976 and headquartered in Ulsan, South Korea, DAE-IL Corp. manufactures and sells powertrain parts for automotive, heavy equipment and motorcycles. Its products include gears, car transmission and engine parts, heavy equipment products – such as transaxles, drive axles and transmission and excavator products – and motorcycle transmission and engine products. The company’s primary export markets include the US, China, Europe and Japan.

DAE-IL joins four other South Korean owned companies in Kentucky, which already employ about 400 people. The state’s automotive industry includes 522 facilities employing more than 100,000 people. Kentucky’s gateway position between the automotive hotbeds of the US Midwest and South make it a top location for parts production, component manufacturing and vehicle assembly.

Sen. Stan Humphries, of Cadiz, expressed gratitude for the company’s arrival to Calloway County.

“It gives me great pleasure to welcome DAE-IL Corp.’s first US manufacturing facility to Murray,” Sen. Humphries said. “This $50 million facility that looks to create 120 new Kentucky jobs is huge for our region. I want to congratulate and thank DAE-IL for choosing Murray for their new facility, and thanks to the Cabinet for Economic Development for helping make this project possible.”

Rep. Kenny Imes, of Murray, thanked the company and economic developers who made the project happen.

“The addition to Murray of the first US manufacturing facility for DAE-IL will reap huge rewards for Kentuckians in the entire region,” Rep. Imes said. “A $50 million shot in the arm for our economy and 120 new jobs in the booming auto industry are huge news, and I commend everybody involved in making this happen. Western Kentucky is on the right track to surge into future success.”

Calloway County Judge-Executive Larry Elkins said the nature of the positions being made available at DAE-IL will greatly benefit the local workforce.

“Both I and the fiscal court want to express how pleased we are to see this project come to Calloway County,” Judge-Executive Elkins said. “Creating jobs that are high tech and with good pay supports families and makes our community a great place to live. Not only will this company provide production jobs but there will be opportunities for engineers, technicians and other skilled professionals.”

Murray Mayor Jack Rose acknowledged the group effort necessary to make a project such as this possible.

“This is indeed a great day for Murray and Calloway County. The EDC has been working on this with the Cabinet for Economic Development and TVA for quite some time, and it is great to see everything come together,” Mayor Rose said. “We have a great team in place and we look forward to helping DAE-IL become an integral part of this community.”

Mark Manning, president of the Murray-Calloway Economic Development Corp., said the company has strong leadership that will be beneficial in integrating into the community.

“I have come to know Mr. Kim and his staff quite well over the last year and can say without hesitation that they are the kind of people who will fit well in Murray,” Manning said. “We will do our very best to help see that they are successful and happy here for many years.”

To encourage the investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) in December 2017 preliminarily approved the company for tax incentives up to $3 million through the Kentucky Business Investment program. The performance-based incentive allows a company to keep a portion of its investment over the agreement term through corporate income tax credits and wage assessments by meeting job and investment targets.

Additionally, KEDFA approved DAE-IL for up to $500,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing.

In addition, DAE-IL can receive resources from the Kentucky Skills Network. Through the Kentucky Skills Network, companies can receive no-cost recruitment and job placement services, reduced-cost customized training and job training incentives. In fiscal year 2017, the Kentucky Skills Network provided training for more than 120,000 Kentuckians and 5,700 companies from a variety of industry sectors.

A detailed community profile for Calloway County can be viewed here.

IoT Experience for Metalformers and Fabricators

Learn how colleagues are implementing IoT through case studies

The coming wave of digital manufacturing and plant-floor connectivity is here for metalformers and fabricators. MetalForming magazine, published by the Precision Metalforming Association (PMA),  understands that the technology manufacturers use changes rapidly, especially within the Industrial Internet of Things. Because of these advances in technology, MetalForming magazine has created the Internet of Things Experience to educate manufacturers on how this technology can be leveraged to optimize your operations and plant-floor procedures.

With multiple case studies during the event, attendees will be given a roadmap for planning and executing an IoT plan. For example, the case study presented by Jim Finnerty, product manager, Wintriss Controls Group LLC, shows how metalformers utilize real-time gathering of production data to enable quick and decisive actions to generate a boost in overall equipment effectiveness (OEE) in the pressroom. It’s a terrific example of Industry 4.0 connectivity impacting the metalforming industry.

About Jim Finnerty
Jim has been with Wintriss Controls Group for more than 26 years and is responsible for new product development and sensor applications. He has helped metal stampers implement sensors and prevent die crashes for more than 35 years, and has published numerous articles about the metalforming industry. He also is an active member of the Precision Metalforming Association, serving on multiple committees and presenting at countless PMA technical seminars, FABTECH, and conferences around the world.

KAIA members can take advantage of the PMA-member rate (a 50% discount) by using the code IOTHALFOFF when registering!

Register Now

KAIA Legislative Update – January 17, 2018

For the first time in history, Republican governor Matt Bevin presented his version of the biennial budget to both a Republican-controlled House and Senate this evening. Taking the position that government’s functions should be limited to protection of citizens, infrastructure and education, the Governor outlined his priorities for “getting Kentucky’s financial house in order.” 

Highlights of the Address 
1. The Budget fully funds pensions costs for state employees and the Teachers’ Retirement System’s funding request with a combined total of about $3.3B over the biennium. SEEK allocation funds are being maintained at $3,981 per pupil, but the Budget shifts responsibility for employee health insurance to local districts, who are also being asked to reduce administrative costs and use their reserve funds. 

2. The Budget continues the investment in workforce development with another $100M bond pool for projects with local matching funds and private investment. 

3. The Governor’s focus on public protection was evident in budget proposals that: 

  • support the war on the state’s opioid crisis with $34M in additional funding;
  • fund 75 new prosecutors and 51 new public advocates to reduce legal case backlogs;
  • fund the replacement of aging state police equipment;
  • adding $24M for adding social workers and substantially increasing salaries; and
  • added a new program with about $11M to support foster children and adoption initiatives. 

4. The Budget’s sizeable pension funding required cuts that including the elimination of 70 programs and 6.25% across the board cuts in state government, excepting items such as SEEK. 

5. The Governor noted the recently approved 1115 Medicaid waiver as a reform that will enable cost management in the future. 

6. The Governor announced a policy of managing the criminal justice system with the aim of needing to build no more prisons in the state. 

7. Tax modernization was made a priority for 2018, though the likelihood of a special session remains unclear. 

8. The Budget allocates $250M to the state Rainy Day Fund which has a current zero balance, about half of what is recommended by best practices. 

SAVE THE DATE FOR KAIA’S LEGISLATIVE RECEPTION!
KAIA will host a legislative reception on Tuesday, February 13, 2018, from 6:00-8:00 PM in the Single Oak Room at the Buffalo Trace Distillery in Frankfort. Mark your calendars and plan to attend to meet key movers and shakers in the General Assembly, and network with other Automotive Industry members!

A Special Invitation for KAIA Members
Want to learn about the key issues and have an opportunity to get your questions answered and your voice heard? Our friends at the Kentucky Association of Manufacturers (KAM) have graciously extended an invitation to all KAIA members to join their weekly conference calls! Key information is included below. Join in and be a part of the conversation every Thursday at 4:00 PM EST!

Here is the call-in information for Thursday’s KAM Conversations, scheduled for 4:00 PM EST:

  • Dial-In Number:               877-746-4263
  • Participant Code:            0219774#

As always, if you have questions and/or need additional information, please do not hesitate to contact us!


Dave Tatman

KAIA Legislative Update

The Kentucky General Assembly returned this week for the 2018 Legislative Session. This Session is a 60-day session with the constitutional requirement that a biennial budget for the state must be enacted. With an expected special session not being called by the governor the latter part of 2017 to deal with the state’s ailing pension system, this complex and deeply controversial issue is expected to be the major focus for the next several weeks of Session.

Key Issues in 2018
The most important issue in an even numbered year Session is the passage of Kentucky’s Biennial Budget. Designing the 2018 Budget will be very difficult, considering the state’s revenue shortfall. Additionally, pension reform and slow revenue growth will make adoption of the Budget a significant challenge.
Other issues lawmakers are most likely to address include tax reform, (could be achieved later in 2018) as well as tools to fight the opioid epidemic, foster child law changes, and reforms to the workers’ compensation system.

Key Dates
   • January 2nd General Assembly Convenes
   • January 16th Governor’s Budget Address
   • January 30th Candidate Filing Deadline for November 2018 Races
   • April 13th Session adjourns sine die

Special Elections Scheduled for 2018
   • February 20th – 49th House District (Bullitt County), vacated upon the death of Republican Dan Johnson
   • February 27th – 89th House District (Clay, Laurel and Estill Counties), vacated upon the resignation of Republican Marie Rader.

SAVE THE DATE FOR KAIA’S LEGISLATIVE RECEPTION!
KAIA will host a legislative reception on Tuesday, February 13, 2018, from 6:00-8:00 PM in the Single Oak Room at the Buffalo Trace Distillery in Frankfort. Mark your calendars and plan to attend to meet key movers and shakers in the General Assembly, and network with other Automotive Industry members!

A Special Invitation for KAIA Members
Want to learn about the key issues and have an opportunity to get your questions answered and your voice heard? Our friends at the Kentucky Association of Manufacturers (KAM) have graciously extended an invitation to all KAIA members to join their weekly conference calls! The first one is today, and the key information is included below. Join in and be a part of the conversation!

Here is the call-in information for today’s KAM Conversations, scheduled for 4:00 PM EST:

   • Dial-In Number:               877-746-4263
   • Participant Code:            0219774#

As always, if you have questions and/or need additional information, please do not hesitate to contact us!

Dave Tatman
Executive Director