Doing more with less.
S.C. may go west for aerospace companies
South Carolina has also looked west to recruit aerospace companies.
According to a report this week in the Puget Sound Business Journal, two of the state’s economic development groups, the Charleston Regional Development Alliance and the Central Alliance, were recently in the Seattle area.
“In a face-to-face meeting, the folks pitching invited one supplier to go to the Masters with them for a week ... (it’s) the hardest golf tournament to get into in the world,” said Bruce Kendall, director of the Economic Development Board for Tacoma-Pierce County, according to the article.
The development alliance didn’t make that offer, said spokeswoman Claire Gibbons. David King, vice president of marketing for the Central Alliance, also denied his organization floated the Masters invite but said he wanted to read the article before saying more.
Hitt said he couldn’t verify the Masters offer but said if a supplier executive is a golfer, “that could probably be effective.”
That seems to be South Carolina’s plan for next week’s Paris Air Show, the 50th iteration of the premier aerospace expo.
In comparison to the last couple of years, the state is sending fewer representatives yet has more meetings planned with companies considering expansions here.
The 16-member delegation has 80 scheduled meetings, S.C. Commerce Secretary Bobby Hitt said during a teleconference Thursday. And as reported in The Post and Courier last month, the group won’t include Gov. Nikki Haley for the first time during her term.
“This particular instance, we believe with the types of meetings we have and the relationships we’ve built, she’s not essential to this mission,” said Hitt, who also won’t be in Paris. “These are ongoing discussions with companies we’ve already met with.”
According to her spokesman, Haley will keep busy with her normal in-state activities.
Hitt said in contrast to previous “meet-and-greets,” the company get-togethers this time will be more advance-stage “meetings for final deal discussions” that would include discussion of “meatier issues,” like the prospect companies’ utility, workforce and transportation requirements.
“This is a good sign,” Hitt said. “This is what we think is the normal gestation of what occurs.”
Hitt wouldn’t estimate the budget for the week-long industry conference, saying that accounting would come after the group returned, but there was at least one other indication the trip could be cheaper than the past couple of years, when the bills were north of $100,000. Instead of a swanky off-site reception like in London in 2012 and Paris in 2011, the state’s reception Tuesday will be at its booth within the U.S. pavilion at the air show.
South Carolina will be one of 22 states represented. In addition to providing a venue for manufacturers like Boeing to show off new products and announcing plane orders, the June 17-23 show is a unique opportunity for government officials to court companies and new jobs.
In recent years, Haley and her predecessor, the newly sworn-in U.S. Rep. Mark Sanford, have tried to leverage Boeing’s growing North Charleston 787 Dreamliner plant to convince other manufacturers and suppliers to join South Carolina’s aerospace industry, which Hitt said now employs some 23,000 people.
“We believe if we do this right it will match automotive in the next several years,” the former BMW executive said. Hitt said Boeing’s recent expansion announcement, “in essence (said) to the world, ‘We have been successful in South Carolina, and we’re going to double down.’”
In April the company pledged to invest another $1.1 billion and hire another 2,000 people in South Carolina over the next eight years in exchange for a $120 million from the state among other incentives.
“Needless to say that gets the attention of all of their suppliers,” he said. “They need to become more serious about South Carolina because Boeing has.”
Given Boeing’s current production rates in North Charleston, it makes sense for many of its suppliers to build their parts elsewhere and ship them to South Carolina, Hitt said. But if and when that cost-benefit analysis tips, they’ll show up here – just like what happened with BMW over past couple of decades, Hitt said.
“They’re going to come here at a point in time when they can invest and make money here,” Hitt said.
Haley faced criticism for the high costs of the state’s mission to Paris event in 2011. The state spent some $158,000 on the conference that year, including $25,000 on a reception for prospective corporate immigrants at a historic Paris townhouse. At last July’s Farnborough International Airshow in England, Haley again hosted a reception at a posh venue, but it was sponsored by the likes of Michelin’s Greenville-based aviation tire division and GKN Aerospace, which has a factory in Orangeburg. The overall public cost of the mission was considerably less, closer to $106,000 according to Hitt’s agency, with the private sector picking up more of the tab.
Last year, Haley led a 30-member delegation to the biennial Farnborough International Airshow outside London, where the state had some 50 meetings scheduled. The state sent 27 people to Paris in 2011. The state delegation this year is comprised of a handful of Commerce employees from Columbia, led by Hitt’s deputy and retired Air Force general, George Patrick; a handful from Commerce’s European office in Munich; and several economic development officials from around the state. Charleston Regional Development Alliance CEO David Ginn and Charleston County economic development director Steve Dykes will represent local interests, said alliance spokeswoman Claire Gibbons.
“We’ve got a bunch of appointments lined up,” Gibbons said, calling it a “morning-to-night opportunity.”
While some have criticized such missions for failing to bear immediate fruit in the form of deals, economic development officials have said deals only come together over time and by establishing relationships.
There’s also fierce competition from neighboring states, several of whose governors will be in Paris next week. The governors of Georgia, Florida, Mississippi, and Alabama, where Boeing rival Airbus is building an aircraft plant, will all attend, their offices confirmed last month.
The state of Washington, Boeing’s historic home base, will be sending more than 50 people, according to the Puget Sound Business Journal. Gov. Jay Inslee was supposed to lead the delegation, but on Thursday he said budget stalemate in his state would keep him home. U.S. Rep. Rick Larsen, the top Democrat on the House Aviation Subcommittee, would stand in for him.
Asked about other states’ governor-led or much larger delegations, Hitt said, “I think you can draw your own conclusions.”“Let’s just say the race is on,” he said.
Editor’s note: This is an expanded version of a story that ran in Friday’s print edition of The Post and Courier.
Reach Brendan Kearney at 937-5906 and follow him on Twitter at @kearney_brendan.