UGN Inc., based near Chicago, Ill., projects the new factory to create annual payroll of more than $7 million.
Before construction can start, final details need to be hammered out, including a lease agreement with the property owner, said Randy Khalaf, chief financial officer of UGN. The project is also pending local and state government tax incentive approvals, the auto industry supplier said.
Assuming everything moves forward, the 206,400-square-foot auto parts plant would be built at the business park Park North at Monroe, near the intersection of Interstate 75 and Ohio 63 in Warren County, according to officials with Cincinnati USA Partnership for Economic Development, the region’s head development agency. The site also has room for an additional 150,000-square-feet for future expansion, UGN said.
“We’re excited to be part of the community. That’s one of our keys whenever we do business,” Khalaf said.
UGN considered locations in Ohio and Indiana to build the plant. Ohio ultimately won the business for several reasons, including the state and local governments partnering to offer incentives to help lower the investment cost, Khalaf said. The future Monroe plant will also supply Japanese automaker Honda, he said, which has major manufacturing operations in central Ohio.
Company officials were drawn to Monroe because “proximity to our customers is one of the keys. Site location is another key. Available skilled folks to help support operations was key,” Khalaf said.
The investment will create job opportunities for residents of Monroe and surrounding communities, Monroe City Manager William Brock said in a written statement.
“We believe that UGN is the type of successful company that fits well with our vision for our industrial areas,” Brock said.
UGN specializes in production of interior components that reduce the inside noise of vehicles. The company also produces other interior components, such as headliner trims, trunk carpeting and carpeting for interior car, truck and utility vehicle floors.
Business is growing, and plans are to start a new plant in Monroe to build products new to the company, Khalaf said. Workers hired in Monroe will make automotive carpeting primarily for Honda, and an underfloor module for vehicles. He described the underfloor module as a textile sheeting underneath the carpet that covers the powertrain to reduce noise in the vehicle, and improve fuel efficiency.
“The current products that this plant is going to be producing move to mass production late summer next year,” he said. “We’re going to actually have our equipment installed and start running trial parts early next year.”
Hiring could begin by the second half of this year, starting with plant managers. Hiring will ramp up to assembly workers as things move closer to full production, he said.
Currently UGN, founded in 1986, employs more than 1,500 people at six facilities in the United States plus a seventh facility in Mexico. These facilities produce acoustic, interior trim and thermal management products for North American and Japanese automotive manufacturers. UGN is a joint venture of Swiss and Japanese auto suppliers Autoneum and Nittoku, Khalaf said.
UGN’s announcement is the latest win for the Cincinnati-Dayton region’s automotive industry. Other auto suppliers to recently announce expansions include Fuyao, a Chinese autoglass manufacturer planning to open a production site in Moraine and hire up to 800 workers; ThyssenKrupp Bilstein of America Inc., a German-based manufacturer of shock absorbers for vehicles that has made several expansions to invest in new equipment at its existing Hamilton plant; and ADVICS Manufacturing Ohio Inc., a Japanese brake components manufacturer planning a $100 million expansion of its Lebanon facilities, that includes adding 100 new jobs by the end of 2015.
It’s a great example “of Ohio really playing to its strengths and the region playing to its strengths being able to attract a company in the auto space,” said Matt Davis, interim executive director of the Cincinnati USA Partnership, one of six regional agencies statewide that coordinates economic development with the private JobsOhio.
“They see other businesses coming here and expanding here in that space and this is just a really attractive market for that. We’re close to customers that use the parts,” Davis said.
Warren County will work with UGN during the development phase, said Martin Russell, the county’s economic development director.
“With recent announcements form ADVICS manufacturing and now UGN, Warren County is pleased to work with automotive manufacturers as they see a rebound of growth in the auto market,” Russell said.
About the Author