News Column

BMW, Michelin Drive Increase in SC Exports

Feb. 29, 2012

Trevor Anderson

BMW logo

Two upstate manufacturing staples -- vehicles and tires -- helped drive South Carolina's exports to a 21.4 percent increase in 2011.

The S.C. Department of Commerce and State Ports Authority announced Tuesday that the state's exports totaled more than $24.6 billion in goods sold to 198 countries last year.

Germany-based automaker BMW's Spartanburg County plant, which produces the company's X3, X5 and X6 Sport Activity Vehicles, helped lead a 56 percent increase in the state's export of vehicles to nearly $7.4 billion, compared to just more than $4.7 billion in 2010.

South Carolina surpassed Michigan in 2011 as the largest exporter of vehicles in the country. The value of the Great Lake State's vehicle exports totaled just more than $7.3 billion last year. The state also made up about 15 percent of the national market for vehicle exports.

Greenville-based Michelin North America, South Carolina's largest producer of commercial, passenger and specialty tires, contributed to about a 24 percent increase in the state's export of tires to $1.6 billion last year, compared to less than $1.3 billion in 2010.

South Carolina's export growth rate ranked it 14th in the nation, according to S.C. commerce. The state's top 10 export industries were vehicles, machinery, rubber, electrical machinery, plastics, paper products, organic chemicals, optics and medical equipment, wood pulp and cotton yarn and fabric.

Germany overtook Canada as the state's largest consumer, with nearly $4 billion in products purchased last year.

"South Carolinians know how to make things," S.C. commerce Secretary Bobby Hitt, said in a statement. "And we ship them the world over."

BMW Manufacturing Co. has not yet released its official exports for 2011, but said in January that it produced 276,000 vehicles during the year.

The $5 billion, 4 million-square-foot plant exports about 70 percent of the vehicles it produces to more than 130 markets worldwide. Based on that math, the company exported about 193,000 vehicles last year.

BMW was named the state's exporter of the year for 2010. In January, the company announced its plan to invest $900 million and hire 1,000 employees at its local plant over the next three years to add the new X4 and ramp up total production to 350,000 vehicles per year.

The company, which employs about 7,000, will hire 300 workers this year and up its output to 300,000 vehicles.

"We're very excited for the state of South Carolina and the role that it has in the global trade economy that we're in," said BMW Manufacturing Co. spokesman Max Metcalf. "We're extremely proud to be a part of that."

S.C. commerce said the state holds nearly 30 percent of the share of U.S.-made exported tires. That market share could grow as Michelin continues to expand its product offerings, and large tire makers Continental and Bridgestone are setting up shop in South Carolina.

In a statement, Gov. Nikki Haley touted Tuesday's announcement as "great news for South Carolina." She also expressed the need to continue modernizing and improving the state's ports system to bolster economic development statewide.

Moving forward

State lawmakers have been advocating for the deepening of the Port of Charleston and the state's other ports since November, when the S.C. Department of Health and Environmental Control board awarded a permit to Georgia for the deepening of the Savannah Harbor.

Last Wednesday, the state House budget committee passed an amendment that will create the Harbor Deepening Reserve Fund within the State Ports Authority. It includes $180 million in non-recurring funds to be used for deepening the state's harbors and hopefully as a means of attracting investment and jobs to the state.

The Charleston Harbor project is expected to cost $300 million. It is in the first year of its study phase, which is anticipated to take five to eight years.

State Ports Authority spokeswoman Allison Skipper said project leaders are hoping to expedite the study and move on to the construction phase as soon as possible.

The state legislature would have the ability to approve expenditures from the fund if it decides to add the measure to its fiscal budget.

Pete Selleck, chairman and president of Greenville-based Michelin North America, said Tuesday's report illustrates South Carolina's need for a competitive deepwater port.

"South Carolina is poised to become the No. 1 tire producing state in the U.S. and the tires that we make here are exported all over the world," said Pete Selleck, chairman and president of Michelin North America. "That's why it is so critical to South Carolina's future economic growth that the Port of Charleston is deepened as quickly as possible."

Among other U.S. states, according to S.C. commerce, South Carolina also:

- Ranked 17th in exports.

- Ranked second in exports to Germany behind California.

- Ranked fourth in exports to Saudi Arabia.

- Ranked 10th in exports to China.

Source: (c) 2012 the Spartanburg Herald-Journal (Spartanburg, S.C.)

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