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Gestamp brings stamping plant back to life

CHARLESTON, W.Va. -- A top executive with auto parts manufacturer Gestamp said he expects the South Charleston stamping plant to eventually make parts that will be found in vehicles around the world.

Craig Parsons, Gestamp's vice president of sales and business development in North America, made the comment Monday following a festive ribbon-cutting ceremony at the 922,000-square-foot plant on MacCorkle Avenue.

John Craig, president of Gestamp North America, said in April that the plant would be a primary supplier for Honda and Ford. The "primary supplier" label is significant because it means a plant is a critical link in an automaker's supply chain. Secondary suppliers can be called on mainly to provide parts during peak demand periods. That can create wild swings in employment levels.

Parsons was asked if Gestamp is still planning for the South Charleston plant to be a primary supplier to Honda and Ford.

After reflecting a moment, Parsons said, "Everything has happened so fast. We have almost one million square feet of space here. We've got to fill it up. We'll be both a primary and a secondary supplier. It's safe to say that just about every major automaker is going to have parts coming out of here. That may not happen in the next few months but we believe it will happen."

Gestamp began making auto parts in South Charleston in August on two conventional cold-stamping lines. The process involves stamping an auto body part out of a cold sheet of steel using great force.

Parsons said the company also has installed two lines that use a new technology called press hardening, which involves heating boron steel and then stamping it. The process produces thinner, stronger parts. Those lines are currently being tested, he said.

Asked what parts will be made on the lines that employ press hardening, Parsons said, "There is a whole list of parts that use the process -- they're mostly structural parts."

Gestamp, a privately owned company based in Spain, has promised to invest at least $100 million in the plant and eventually hire at least 400 employees. In return, the company will receive state and local tax incentives. The consulting firm that helped Gestamp negotiate the deal has said the value of the incentives "could eclipse an estimated $55 million." Analyst Sean O'Leary of the West Virginia Center on Budget and Policy has estimated the incentives are worth $84.4 million.

About 70 employees currently work at the plant. Parsons confirmed that Gestamp may add 30 to 40 more workers by the end of the year.

During the public ceremony the plant director, Ignacio Pipio, thanked the employees for their efforts.

"They made possible the start of operations earlier than projected," he said. "We have been successful. We have confidence in our future growth."

Employees, dressed in dark blue uniforms, sat in several back rows during the public ceremony, which took place in an unused portion of the plant in front of a giant American flag.

Kim Adkins, 52, said she was unemployed before Gestamp hired her. Before she was unemployed, she was a home care worker.

Adkins said she came to the Gestamp job with prior manufacturing experience. She said she had worked in Indiana for Dana making sensors and for Skyline making trailers.

It took about three months from the time Adkins turned in her job application at WorkForce West Virginia to the day she heard back about her employment status.

"I'm excited and tickled," Adkins said about her job at Gestamp. "I jumped up and down when I got the call."

Speakers at the ceremony praised Park Corp. Chairman Ray Park for having faith in West Virginia and risking millions of dollars to refurbish the plant even though he didn't have a tenant.

It was Park who convinced Gestamp to take a look at the plant, said Gov. Earl Ray Tomblin. Park "is a visionary businessman," Tomblin said.

Wes Holden, director of constituent services for U.S. Sen. Jay Rockefeller, read a greeting from Rockefeller, who could not attend. Rockefeller said Park "believes, just as I do, in the people of West Virginia."

U.S. Sen. Joe Manchin, D-W.Va., was governor in 2006 when the previous tenant ceased operations at the plant. Manchin got the state to lend Park $15 million dollars.

"The government can spend your money or invest it," Manchin said on Monday. "This was an investment." Manchin said that when he was governor he heard about Park and did his homework and when they finally met, "I said, 'Whatever you want to do, we'll be with you.'

"Whenever we can partner with a company that always pays its bills...those are the types of people you want to partner with," Manchin said. "He said he didn't know about this partnership thing. I said, 'Trust me, it will work.'

"Not only did the taxpayers invest $15 million, he has paid every penny back, with interest," Manchin said. "You can't find a better partner."

U.S. Rep. Shelley Moore Capito said she visited the plant before renovations began and later, during renovations "when the economy got stopped. Ray still had faith in West Virginia, this facility and the auto industry. I join my voice in gratitude to Mr. Park."

Kanawha Commission President Kent Carper said the re-opening of the plant is indeed the result of a public-private partnership.

"The government didn't just get out of the way, the government paved the way to make the impossible possible," he said.

South Charleston Mayor Frank Mullens said the plant re-opening "is a prime example of the city, state and county governments working together for a common goal." Ray Park "never gave up," he said.

Park said the South Charleston deal was put together in 21 days. He singled out Rolland Phillips, the West Virginia Development Office's senior manager of business retention and expansion, for special praise. Also, Gestamp's Craig Parsons and South Charleston City Manager Carlton Lee "worked night and day," he said.

"Gestamp at first wanted to buy the equipment and ship it all over the world," Park said. "They said they'd pay me $25 million in two days." Park said he declined to sell the equipment and, eventually, Jeff Wilson, president of Gestamp's operations in North America and Southeast Asia, came to tour the factory.

"He said, 'Ray, we've got to have the plant,'<#148> Park recalled. "I said, 'You've got to lease the equipment here and you'll have the best plant in North America.'<#148>

Park said, "This is my adopted state. I love it."

Monday's ceremony "is all about jobs, jobs, jobs." Park said. "Gestamp is the largest stamper in the world. They come here, lease the place, hire people. What's better than that?"Contact writer George Hohmann at business@dailymail.com or 304-348-4836.


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