Jul 20 2010
Raytheon's decision to build a missile plant on Redstone Arsenal is both recognition of the talent and resources in this area and harbinger of a major new economic base for Alabama, said Gov. Bob Riley.
"More and more people are beginning to recognize what we have there. I think you're going to see Alabama become a part of an aviation/aerospace corridor that is developing all across the Gulf Coast," he said.
"We have the capability today to build another economic foundation in aviation and aerospace very, very similar to what we've developed in the automotive industry," Riley said.
On Monday, at the Farnborough International Airshow in England, Riley and Dr. Taylor Lawrence, president of Raytheon Missile Systems, announced the company will break ground later this year for a 70,000-square-foot facility on the south end of Redstone Arsenal, at the former Morton Thiokol site. It will employ about 300 people and is to be built in two phases, each tied to production contracts for the Standard Missile-3 and Standard Missile-6.
SM-3 is part of the Missile Defense Agency's sea-based Aegis Ballistic Missile Defense System, deployed on U.S. and allied ships to defend against short- to intermediate-range ballistic missiles. MDA Director Army Lt. Gen. Patrick O'Reilly has said the agency is considering a land-based version of the SM-3 and would locate that project office in Huntsville.
SM-6, also known as the Extended Range Active Missile, is being developed for the Navy to use against fixed- and rotary-wing aircraft, unmanned aerial vehicles and anti-ship cruise missiles in flight, both over sea and land.
"This is a great day for Huntsville," said Mayor Tommy Battle on Monday, adding that the plant should also benefit other Tennessee Valley communities.
The area is well known for what he called "laptop" work: software development, research, engineering and the like. The Raytheon plant will bring more highly-trained manufacturing positions.
The announcement was welcome news for the area, which has been reeling from layoffs and potential cuts to NASA's Constellation manned space exploration program.
"To know that Raytheon is making this type of commitment to North Alabama and to Madison County could not come at a better time and it could not be more positive," Riley said in a telephone interview from England.
"There were a number of states that were under consideration by Raytheon for this facility," said Brian Hilson, president of the http://www.huntsvillealabamausa.com/Huntsville/Madison County Chamber of Commerce. "In short, this is a world-class facility at what we think is a world-class community and we're very proud to get it."
Hilson said Raytheon is to get a $2 million cash incentive, in one $1 million and two $500,000 increments, when they meet job creation goals.
And, should there be additional physical development off-site from the arsenal, then the city and county - as they always do, Hilson said - could participate as far as potential tax abatements and potential tax credits.
After considering the location, existing infrastructure, state and local incentives, "Huntsville, Alabama, became the clear choice," Lawrence said.
The Alabama Development Office has been the lead agency for this deal, working with Raytheon and federal officials about leasing the site on Redstone Arsenal, Battle said.
Hiring is expected to begin sometime next year. Hilson said Alabama Industrial Development Training will be providing recruitment screening and pre-employment training.
Raytheon already employs nearly 700 in the Huntsville area. According to the project agreement with the state, the average annual base wage for the new plant's workers will be $60,000.
In a phone interview Monday from England, Riley said he had spoken again that morning with EADS officials about their competition with Boeing to provide refueling tankers to the Air Force. If they win, EADS plans to build the big KC-45 tankers at a $700 million, 1,500-job factory to be constructed in Mobile.
Riley pointed out there are presently only two places in the world where the giant, wide-bodied jets are built: The EADS plant in Toulouse, France, and the Boeing facility in Seattle, Washington.
"I think we've got a great chance to win the project in Mobile, so that would be the third place," he said. That, combined with the growing Army aviation, unmanned aircraft, helicopter, missile, NASA and other aerospace activity already here, should make Alabama even more attractive to manufacturers, he said.
In fact, Riley said he met with another aerospace company during the Farnborough show, but he declined to give their name at this time.
"That's going to be our next opportunity and our next challenge," Riley said, "to build that same type of core competency in aviation and aerospace that we did in automotive. And there's no reason in the world we shouldn't do it."