When aerospace giant Airbus decided to manufacture a range of narrow-body aircraft in North America, it set the hearts of economic developers a flutter. Large in capital expenditure value as well in headcount, it is the kind of FDI project that can help an entire local or even regional economy take off.
In July 2012, the Europe-based company announced the winning location was Mobile, Alabama, a small port city on the Gulf of Mexico two hours’ drive east of New Orleans. Airbus is not entirely new to Mobile: it placed an engineering centre there nearly a decade ago, on a site next to the new assembly complex, which employs more than 200 people.
The Mobile Aeroplex facility, located on a former Air Force base, now hosts the final assembly of a family of A319, A320 and A321 aircraft. In June 2015, the first components of the Jet Blue A320 arrived in Mobile to great fanfare and were delivered via Mardi Gras-style parade from the Mobile Container Terminal to the final assembly line. The grand opening took place that September and production started in March 2016. There are already 500 employees but that number looks set to expand. While the hard work has now begun, in many ways the city is still celebrating the victory.
“It was a game-changer for our community,” says mayor Sandy Stimpson.
Receiving the stamp of approval from such a big-name company is invaluable to a small city in the world of FDI. “There has to be some compelling reasons why [such a company] would look at you to begin with. For Airbus, it was because of our infrastructure, having to do with the port, railroads, interstate highway system, and [the availability as a site of a] somewhat under-used former Air Force base,” says Mr Stimpson. “Another thing we’re known for is manufacturing. We have an outstanding reputation for the workforce, for being able to produce high-quality products and advanced manufacturing. The competitive cost of doing so is attractive compared with other areas.”
Mr Stimpson loves recounting that when final quality inspections were taking place on Airbus’ very first Mobile-assembled plane, which was sold to JetBlue, “the only thing they found wrong was that the coffee pot didn’t work”.
“That’s a huge win for the community and for Airbus,” he says. “The word gets around that people are having a great experience in Mobile, and that just builds upon itself. Is it difficult to compete? Yes, it’s very competitive out there. But we feel like we are poised and really already planted on the world stage, and that we are equipped for success.”
Suppliers line up
Since the assembly plant opened in September 2015, 15 suppliers have followed.
There is also speculation that Mobile is being eyed for a new assembly hub for Airbus’s A400M military aircraft. This aircraft has been plagued with production and delivery issues to date, and Airbus’s superjumbo A380 has not taken off in demand as hoped so production has been slashed. Some of these woes might point to the risk of having a city’s fortunes too closely allied with a mega-investor.
Happily for Mobile, though, the reduction in jumbo-jet production is likely to offset by a focus on popular smaller models, such as the A320. “The narrow-body aircraft made in Mobile is the best-selling aircraft in the world. Air Asia just ordered 100 of them,” says Bill Sisson, president of the Mobile Area Chamber of Commerce.