The Springfield News-Sun provides unmatched coverage of issues that affect jobs and the economy in Clark and Champaign counties. For this story, the paper spoke with city officials and a local manufacturing company to detail a new agreement that will mean new jobs in Springfield.
By the numbers:
$67,000 — average salary of employees at new company
$600,000 — Estimated investment in capital and building repairs as part of deal
43 — Current employees at Palmer Manufacturing
A Springfield manufacturer will start a joint venture with an Italian firm that will lead to new high-paying jobs and about $600,000 of investment in the city.
Palmer Manufacturing, a Springfield company with more than 40 employees, has been working for several months with MAUS S.r.l., an Italian manufacturer that makes automatic grinding and vertical turning equipment. The two firms will combine resources to create a new, third company called Palmer MAUS North America that will be based in Springfield.
The agreement will lead to about five new jobs initially. That figure could double in the next three years, said Tom Franzen, assistant city manager and economic development director for Springfield. The average salary for the new positions is expected to be about $67,000.
The firms will invest about $100,000 to refurbish a 15,000-square-foot facility at 25 Snyder St. The companies will invest about $500,000 more in capital, for items like providing training and covering salaries for employees, said Jack Palmer, owner of Palmer Manufacturing.
MAUS makes automatic grinding equipment for a variety of industries, including the railway, automotive and aerospace industries. Palmer specializes in producing heavy-duty foundry equipment, including molding systems and sand mixers, among other products.
MAUS will remain the majority shareholder under the deal, but workers in Springfield will manufacture the Italian products here. The new company will also sell the products, as well as provide service and stock spare parts, Palmer said.
“It’s a big deal for us,” Palmer said. “We’ve never done a joint venture before and it’s an incredibly involved process.”
The city has been working quietly with both MAUS and Palmer for several months, Franzen said. Not all details have been finalized, but city officials are reviewing whether financial assistance might be available to assist the new firm to buy equipment, or to modify the Snyder Street site, he said.
A proposal could be presented to Springfield city commission members within the next few weeks, Franzen said.
“Palmer is a perfect fit for them and adds a lot of credibility to the Italian company’s presence here in North America,” Franzen said. “They’ll be able to grow sales and hopefully sell more parts and eventually build more machines, but build them here in Springfield.”
MAUS initially contacted Palmer about five ago, asking the Springfield company to sell MAUS products in North America. The Italian company faced challenges with parts supply, communication and other issues, Palmer said. But the Springfield company turned the proposal down initially because it didn’t fit with its business plan.
The new joint venture, in which the products will be manufactured here, makes more sense for both companies, Palmer said.
“Having a local presence will allow us to support our customers with top quality service, sales support and spare parts management,” said Roberto Sammartin, managing director of MAUS in a statement. “This new venture reflects our strong belief that our brand has significant growth potential in North America.”
Palmer already owned the Snyder Street facility, which is undergoing renovation to serve as a manufacturing facility for the new company. That facility will host a grand opening during the 119th Metalcasting Conference in Columbus later this month. Attendees will be taken by bus from Columbus to the new Springfield business.
“We’ve got high hopes,” Palmer said. “We thought long and hard about taking it on because we’re quite busy with our day-to-day work. But we’ve got a good team so we can run our regular business and we’re going to build this one.”
The chamber of commerce wasn’t directly involved in the project. But the new deal is a positive sign both for the Springfield firm and the local economy, said Horton Hobbs, vice president of the Chamber of Greater Springfield.
“Certainly when you see outside investment in a partnership like that, that’s fantastic,” Hobbs said. “It shows strength in our market, it shows strength in the company and bringing two entities together like that is a positive sign for that business.”