NSK Franklin Plant Adds Wheel Bearing Lines, Gets Tax Break

NSK Americas Corp. (a division of NSK Ltd., Japan), manufacturing plant in Franklin, Indiana is adding capacity, hiring more workers, and netted a seven-year tax break for the effort. The Franklin Ball Screw and Automotive Hub Manufacturing Plant has been in operation since 1993. Employing approximately 360 people, the plant manufactures ball screws for positioning purposes in semiconductor manufacturing equipment, and automotive hub units, primarily for Toyota, Honda, DaimlerChrysler, Nissan and General Motors. NSK is adding capacity to supply third-generation wheel hub and bearing assemblies for the 2005 Chevrolet Equinox compact SUV and the 2005 Subaru Legacy and Outback. The Equinox shares its front-drive / 4WD platform with the Saturn VUE, for which NSK Franklin supplies the wheel hub assemblies. The Equinox, however, should add significant production volume for those hubs. Equinox bearings will be shipped to the GM-Suzuki joint venture, CAMI Automotive Ind., in Ingersoll, Ontario, Canada. CAMI began Equinox production in mid-February and the vehicles have just begun arriving in dealerships. Franklin is also adding capacity for hub assemblies for Fuji Heavy Industry's all-new 2005 Subaru Legacy and Outback, both built in the U.S. The two new Subarus are due in U.S. dealerships by June. NSK's bearings are being shipped to the Subaru of Indiana Automotive Inc. plant in Lafayette, Indiana. Subaru's Lafayette facility was originally built as a joint venture with Isuzu, but Isuzu was forced to sell out in January 2003, leaving Fuji with the entire $1.1 billion facility. In 2003, SIA manufactured over 90,000 vehicles and expects the new model introductions to drive that up to over 105,000 vehicles in 2004. To support the production boost, NSK Franklin has already added two production lines and plans to hire approximately 20 more people, pushing total employment there to over 380. All of the additional production is expected to be online by mid-summer, at a total cost of just over $8.2 million. NSK approached the Franklin City Council in early February, requesting a ten-year tax abatement tied to the expansion. The company actually knew about the expansion need in late 2003 and notified the city it would be seeking the abatement. While the Franklin Economic Commission noted NSK should have formally requested the abatement before acquiring and installing new equipment, it agreed to the abatement but adjusted the terms to seven years from ten. The $8.2 million total remained unchanged. Franklin City Council recently approved the package. More attention came to the NSK abatement request because NSK is hiring while ArvinMeritor will be closing its Light Vehicle Systems exhaust plant there by the end of September. ArvinMeritor is Franklin's and the county's largest employer; almost 850 people will be losing their jobs as the LVS division reorganizes and work is shifted to other facilities. Franklin also faces 200 lost jobs at Alpine Electronics as it scales back over the next year.