June 29, 2022

Austrian wood products maker Egger to build $ 700 million CN plant


Dive brief:

  • Austrian particle board maker Egger plans to spend $ 700 million over more than 10 years to build its first U.S. plant in Davidson County, North Carolina, according to the Winston-Salem Journal. The company announced that it would employ 770 people there.

  • The first phase is expected to open in 2020 and will serve the construction, flooring and furniture industries; it will cost $ 300 million and create around 400 jobs. In return for its investment in the 4.5 million square foot facility, Egger will receive $ 10.3 million in incentives, with at least $ 5.3 million related to job creation.

  • Egger said average factory wages will be $ 40,000, 8.5% more than the county’s average wage, according to the Triad Business Journal. Egger said he would also buy from timber suppliers and sawmills in the area.

Dive overview:

The new Egger plant will be positioned to supply one of North Carolina’s primary industries – furniture manufacturing. The state is home to factories for furniture companies like Ethan Allen and Ashley Furniture. These operations are supported by the state’s wood products manufacturing industry, the nation’s fifth largest, according to the North Carolina Economic Development Partnership.

As a result, Egger is expected to have a pool of workers already familiar with the production of wood-based materials, which would allow the company to bring the plant online fairly quickly.

Egger is the latest foreign company to take manufacturing operations to Taiwanese-American maker Foxconn also announced this week that it is investing $ 10 billion in a Wisconsin flat-panel display plant that, when completed, will generate 3,000 jobs. In return, the company will receive $ 3 billion in economic incentives from the state over 15 years.

These employment projections are lower than June estimates by Foxconn Chairman Terry Gou that such a move could create up to 50,000 new jobs in the United States.

Places like Taiwan and China were once considered two of the cheapest markets for making products. But with wages on the rise, the United States has become more attractive to domestic companies looking to invest in goods-producing factories. Recode reported that six out of ten jobs brought to the United States between 2010 and 2016 were from China.