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Plasan to expand in Michigan, not Vermont, for now

July 20, 2011
Staff Writer
BENNINGTON — Plasan Carbon Composites has chosen to add a manufacturing plant in Michigan, creating more than 200 jobs there, after receiving a lucrative tax incentive from the state.

President Jim Staargaard announced the company’s plans in a press release. He said the company’s Bennington facility will remain “a key manufacturing location” that will focus “on advanced autoclave technology.”

Staargaard said Wednesday that the decision to expand in Michigan will have “no impact on staffing at Bennington.”

According to the Michigan Economic Growth Authority, Plasan will invest $18 million over a five-year period in the city of Walker, Mich. In exchange, the company will receive a tax credit valued at about $4 million.

The decision to expand manufacturing operations in Michigan follows a seven-year deal struck last December between Plasan and the state of Michigan to relocate the company’s research and development division to Wixom, Mich. Plasan received a tax credit worth about $700,000 to open a technical center there, creating 36 jobs.

The two incentives were combined into one, five-year package, according to the authority.

Plasan makes carbon fiber auto parts. A sister company, Plasan North America, manufactures armor for the defense industry. Both are owned by Plasan Sasa based in Israel.

The new manufacturing facility in Walker will support future mid- to high-volume production for

the North American automotive industry, according to the company’s release. Plasan has developed proprietary technology allowing for cheaper and faster production of carbon fiber parts. The new technology is now operational at the Wixom facility.”This new facility represents the next phase of Plasan Carbon Composites’ commitment to the automotive industry,” Staargaard said in a statement. “We are grateful to the state of Michigan for their support of this technology and true job growth initiative.”

Bennington Town Manager Stuart A. Hurd said town officials are “always concerned when we hear these kinds of things.” The company has indicated its commitment to Bennington, though, he said.

“They’re going to keep their facility here, they’re going to keep tying to expand here,” he said. “I think when they moved their research and development arm out there we should have expected this. That’s where the trained work force is.”

Scott Murphy, the town’s economic and community development director, said the company’s commitment to maintaining employers in Bennington is a relief.

“We certainly dodged a bullet that way. It would have been a big blow to the town if we lost some or all of the jobs to Michigan.”

Meanwhile, town officials have been told the company is continuing to look at expanding locally, too, Murphy said.

Vermont Agency of Commerce and Community Development Deputy Secretary Patricia Moulton Powden said state officials are engaged in ongoing conversations with Plasan about local expansion.

“It’s understandable why they would want to do that in Michigan, but clearly we would like to see them grow here in Vermont. They are aware of that, and we will stay in touch with them about how they can grow here,” she said.

Powden said state officials have met with the company, and Gov. Peter Shumlin will likely look to meet with company officials in the near future. The Agency of Commerce is focusing on addressing financing and workforce challenges that Plasan and other companies face in Vermont, she said.

Powden said Plasan has indicated to state officials that Bennington remains a part of the companies strategic plans.

“I’m not expecting any significant impact from the Michigan operation,” Powden said. “They’ve made it clear Bennington is a strategic asset, yet Michigan is also a key market for them.”

Local and state officials have invested time and energy in developing a composites cluster, currently comprised of the two Plasan companies and Vermont Composites. The hope has been to grow and maintain a steady manufacturing presence of composite companies in Bennington.

In recent years, Plasan North American was a partner on several lucrative contracts to produce armor for a U.S. military vehicle used in Afghanistan. Those contracts have wound down, however, leading to the layoff of 20 workers last September, and raising questions about what will come next for that division.

Plasan North America then announced in October that it was partnering with another firm on a new venture in Rhode Island.

Plasan Carbon Composites then announced in December that its research and development operations was moving to Wixom to be closer to the resurgent auto industry.

Parent company Plasan Sasa announced at the end of May that it acquired KaZak Composites, an engineering and design firm outside of Boston.

Carbon fiber auto parts are widely viewed as the future of auto manufacturing because they are lighter and stronger than tradition steel. The composite parts could help automakers meet higher fuel efficiency standards in the future. Plasan’s proprietary technology is allowing for parts to be manufactured on a larger scale.

Bennington County Industrial Corp. Executive Director Peter Odierna said “the carbon fiber industry … is poised for explosive growth.”

“As the overall industry grows, as carbon fiber has a greater penetration in the auto industry, it’s my understanding that the Bennington plant will participate in that,” Odierna said. “All my discussions with the management team have made it clear that the Bennington facility is still a strategic asset.”

Contact Neal P. Goswami at ngoswami@benningtonbanner.com

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