South Carolina is on one heck of a roll when it comes to tires.
The Palmetto State in the fourth quarter of 2013 elbowed aside Oklahoma as the nation’s leading tire producer, churning out 89,000 a day compared to the Sooner State’s 88,000 a day, according to estimates by Tire Business magazine.
It is also expanding its lead as the export king – last year shipping 30 percent of the nation’s overseas market, three times as many tires as its nearest competitor, Ohio.
“South Carolina is No. 1,” Dave Zielasko, the magazine’s publisher and editor-in-chief, said. “And its not surprising. South Carolina has really been aggressive in attracting these factories.”
Monday’s announcement of a new Giti Tires plant in Chester brings to $3.5 billion the amount of investment tire companies have pumped into the state since 2011. Those new plants and expansions of existing ones are expected to create 5,150 jobs by the end of this decade. That includes the $560 million investment announced Monday by the Singapore tire manufacturer that is expected to produce 1,700 jobs.
The state’s climb to the top of the tire heap is part of an overall rebirth of manufacturing in South Carolina – highlighted by Boeing’s 787 Dreamliner assembly plant in North Charleston – that has led the state’s recovery from the worst recession since the Great Depression.
Unemployment has dropped from a high of nearly 11.9 percent in 2009 to 5.3 percent in April.
Lewis Gossett, chief executive of the S.C. Manufacturers Alliance, said industry hasn’t seen such a boost since the administration of the late Gov. Carroll Campbell in the early 1990s, which launched the state’s automotive manufacturing cluster by landing BMW.
“South Carolina is back in the game,” he said.
HOW IT BEGAN
The state’s tire history began in 1975, when Michelin started production in Greenville. The French company has since expanded to nine plants in the Midlands and the Upstate and has invested more than $5 billion here. It has about 8,900 employees.
Michelin’s latest addition in the Palmetto State is a $750 million plant in Anderson County, which manufactures 13-foot-tall tires for large earth-moving equipment used in the mining industry.
The launch of that production line pushed South Carolina past Oklahoma. And most of those tires are shipped overseas through the Port of Charleston.
The port, said S.C. Secretary of Commerce Bobby Hitt, is a major key to the industry’s success and growth here.
“We don’t grow rubber trees here so a whole lot of essential ingredients have to come in by ship,” he said.
The state’s technical school system also has helped Michelin and subsequent companies take root and grow, as well as the state’s low taxes, anti-union stance and pro-business political bent.
“There is a positive attitude here,” Michelin spokesman Tony Fouladpour said. “It’s a good place to do business in general.”
Michelin’s success – coupled with BMW in Greer – created an automotive cluster the state’s economic development teams were able to sell. It caught of attention of other major tire manufacturers like Bridgestone and Continental.
“Michelin set the pace,” Hitt said.
‘A REASONABLE CHOICE’
Bridgestone opened its first plant in Aiken County in 1999 during the administration of then-Gov. David Beasley.
In 2011, the Japanese company announced plans to invest $1.2 billion in its Graniteville operations, including a new off-road radial tire plant and expansion of an existing light-truck and passenger tire plant. It remains the largest single monetary investment in the state’s history.
The new plant will bring 850 jobs when it reaches full capacity in 2015, bringing Bridgestone’s total number of jobs in the state to more than 1,800.
The same year Bridgestone announced its latest investment, German tire maker Continental said it would build a $500 million tire plant that would employ about 1,600 workers.
Craig Baartman, Continental’s Sumter plant project manager, said at the time that the state’s lucrative use of incentives was a big factor in the company coming to the state. The tire maker also had been heavily courted by other Southeastern states, such as neighboring North Carolina.
“It’s all of that,” Tire Business publisher Zielasko said. “It’s a non-union state. There are a lot of incentives. All of that makes South Carolina a reasonable choice for these companies.”
But Gossett put a lot of credit for the boom in tire manufacturing with Hitt and Gov. Nikki Haley. They have aggressively pursued tire companies and have led the charge for new manufacturing in general, he said.
“They are really putting on the full-court press, and you are seeing the result,” he said. “You can have good (business) conditions, but if you don’t have somebody out there closing deals, nothing happens.”