Constellium-UACJ US$150MM Joint Venture Plant Opens in Kentucky

Constellium-UACJ US$150MM Joint Venture Plant Opens in Kentucky
The City Hall of Bowling Green, Kentucky. Source: Wikipedia

Constellium-UACJ opened its new auto body sheeting plant in Bowling Green, Kentucky this week.

The 225,000-ft2 plant, built at a cost of US$150 million, will produce finished auto body sheet for sale to major American auto manufacturers. Construction of the plant began in 2014 in the Kentucky Transpark. The plant will employ 65 workers and is designed to allow for expansion in the future.

The new plant will process cold-rolled aluminium coils supplied by both joint venture partners and Tri-Arrows Aluminum, a UACJ subsidiary headquartered in nearby Louisville. Tri-Arrows Aluminum produces cold-rolled aluminium coils at a rolling mill it operates in conjunction with Logan Aluminum in Russellville.

In 2014 the state government of Kentucky, under the auspices of the Kentucky Economic Development Finance Authority (KEDFA), authorized a US$4.5 million tax incentive agreement for the project, provided that it would create at least eighty new jobs over the next ten years. The incentive allows the venture to keep a part of its investment over the term of the agreement via corporate income tax credits and wage assessments, provided that job and investment targets are met.

Constellium-UACJ will also receive up to US$1.5 million in tax incentives via the Kentucky Enterprise Initiative Act (KEIA), which allows for certain approved firms to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development, and electronic processing.

The Kentucky Skills Network will also provide benefits to the plant by offering recruitment and job placement services, reduced-cost customized training, and job training incentives at no cost to the firm.

Constellium, based in Amsterdam, was founded in 2011 when Anglo-Australian mining giant Rio Tinto sold Alcan Engineered Products to Apollo Management (51%) and FSI (10%). The firm produces rolled and extruded aluminium products from various alloys. The firm brought in €3.7 billion of revenue in 2014.

UACJ began in 2013 when Japan’s Furukawa-Sky Aluminum and Sumitomo Light Metal Industries integrated their business operations.