From its inception more than a century ago, Alabama’s aerospace industry has grown to host diverse operations across space, defence and aviation.
Across all US states, Alabama is the joint second largest recipient of aerospace FDI – based on the number of projects since 2003 – according to greenfield investment monitor fDi Markets.
The southeastern US state is now home to more than 300 aerospace companies from over 30 countries, including major industry players such as Boeing, Lockheed Martin, GE Aviation, Raytheon and GKN Aerospace, as well as Airbus.
“Alabama has a lot to offer any company considering investment in the US,” says Jeff Knittel, chairman and chief executive of Airbus Americas, who highlights attributes such as openness to business and quality of life.
Two years after starting production at its first US-based commercial aircraft facility in Mobile on Alabama’s Gulf Coast, Airbus announced plans to open a second assembly line for its A220 aircraft.
Expansion of its operations in Mobile’s Aeroplex, a mixed-use industrial complex which hosts two airports, brought the jet manufacturer’s total investment to $1bn, while headcount rose to some 1300 people.
Several aircraft suppliers and service providers have established themselves around Airbus’ Mobile assembly lines, including Netherlands-based MAAS Aviation, China-based Continental Aviation Technologies, and France-based Hutchinson Aerospace and Safran.
Safran USA’s president and chief executive Peter Lengyel claims that several factors made Mobile an attractive place to invest, including alignment of state and local incentives, aerospace workforce availability and affordable energy and tax costs.
“Mobile met and exceeded our expectations in all regards,” he adds.
Total operating costs for an aerospace manufacturing plant in Alabama – estimated at $15.58m per year – are 8.36% lower than the US national average, according to investment destination comparison tool fDi Benchmark.
Research and development facilities and composite materials producers outside of Mobile solidifies Alabama’s aerospace industry.
A research, engineering and test centre in Huntsville hosts both US Army critical missile defence and aviation programmes, and NASA’s Marshall Space Flight Center.
The presence of manufacturers of aerospace grade composite materials, including Toray and Hexcel in Decator, is another distinctive attribute which makes Alabama’s aerospace industry stand out from other US states.
“The carbon fibre that those companies manufacture is very high grade that’s typically used in the aerospace and defence industry. That gives Alabama a unique competitive advantage for certain projects that need those types of skills,” says Didi Caldwell, founder and CEO of site selection consultancy Global Location Strategies.
As with many southern US states with record low unemployment, aerospace employers in Alabama may face labour shortages.
Yet a suite of workforce development programs and partnerships, such as aerospace exhibition and education centre Flight Works Alabama at Mobile’s Aeroplex, aim to address the issue head on.
Mr Knittel claims that despite challenges with hiring enough local talent during Airbus’ rapid expansion, state and local officials worked as a “united team” and helped recruit and train nearly 1000 staff over a five year period.
Alabama’s state-backed industrial training program (AIDT), which has centres in Mobile, Montgomery and Birmingham, works to meet the specific workforce requirements of investing companies.
These “renowned” training programmes have been a “real advantage” for Alabama when attracting manufacturing investments, says Dennis Donovan, a principal at corporate location strategy firm WDG Consulting.
Despite the coronavirus halting production at some manufacturing facilities, AIDT’s training programs have continued to assist companies, Greg Canfield, Alabama’s Commerce Secretary, told fDi at the beginning of May.
“Companies that paused for a few weeks are beginning to resume operations, and we are working closely with them as they re-start in all appropriate areas,” he adds.