Company plans to make vehicles in Hazelwood
St. Louis Post-Dispatch
July 28, 2011
By Tim Logan and Marlon Walker
A deal secretly in the works for five months was sealed publicly Wednesday when Hazelwood approved a measure to help a British company that plans to build a plant to manufacture hybrid electric vans.
Hazelwood Mayor Matthew Robinson said talks between the city and 2-year-old automotive startup Emerald Automotive have taken place since February. Officials say the plant the company plans to build could add nearly 1,000 jobs in the area.
"I think it's great," Robinson said of the company's plans. "They're offering green vehicles, which is something we need here. It's got the potential to be one of the biggest companies in Hazelwood."
Andy Tempest, CEO for Emerald Automotive, said Wednesday that the company will make lightweight delivery vans for European commercial fleets, and eventually offer them for sale in the United States and potentially Asia.
On Wednesday, the Hazelwood City Council approved an ordinance providing a funds match through an economic development sales tax for Emerald to begin work. Officials said $2 million will come from the Missouri Technology Corporation and $3 million will come from the city.
"Missouri is such a great partner for us, especially for the strength of its workforce," said Sharon Heaton, Emerald's general counsel.
Emerald has been working on its vehicle -- the T100 -- for about two years, Heaton said, with a design team made up of veterans of other alternative-car companies such as Lotus, Tesla and Fisker. It will use a battery, recharged by either a diesel or gas engine, and have a range estimated at 475 miles. The trucks would save an estimated $42,000 in typical operations costs over a four-year period.
The target market is delivery, utility and other companies that buy vehicles in bulk and do a lot of driving. The British Royal Mail has been consulting on design, Heaton said, and has a preliminary deal to be an early customer. Indeed, Emerald expects most of its first buyers will be in Europe. But it chose to build the vehicles here in part to tap the skilled labor market and in part because many suppliers are here, she said.
"Also we think over time the U.S. is going to be an extremely strong market for us," she said.
Emerald looked at locations in 25 states, Heaton said. It chose the St. Louis area because of its central location, its pool of experienced autoworkers and "an incredibly businesslike" approach by state and local governments, she said.
"They were very much about, 'How do we make this happen?'" she said.
Emerald is narrowing down a few sites for the plant in Hazelwood, Heaton said.
Besides local funds, the company has $5 million in private capital and a $5 million technology grant from the British government, Heaton said. It hopes to raise $160 million to build the plant from a mix of private equity and U.S. Department of Energy loans for high-efficiency vehicle manufacturing. Smith Electric Vehicles in Kansas City received a similar loan last year to build its line of larger trucks.
Emerald hopes to have a plant fully up and running by 2014, and be making 10,000 vehicles a year by 2015. At that rate, Emerald expects to employ about 580 people, and says its suppliers would likely move in nearby as well, creating an additional 400 jobs.
Compared with the heyday of automaking in St. Louis, when Big Three plants pumped out thousands of cars a month, Emerald's operation would be relatively small -- a "niche product," Heaton calls it.
But it is most welcome news regardless, said Richard Fleming, president of the Regional Chamber and Growth Association. It is a chance to put some talented autoworkers back on the job, he said, and to put St. Louis back on the carmaking map, in a new way.
