Auto Parts Maker To Add Jobs In Western Mass. Expansion
A Japanese automobile parts manufacturer will expand a facility in western Massachusetts rather than move jobs to Mexico.
U.S. Tsubaki will spend at least $12 million to increase the size of its manufacturing plant in Chicopee by more than a third, keeping almost 350 people working in the region, and adding 35 new jobs. Chicopee Mayor Richard Kos, who made the announcement Wednesday, said the company had considered expanding in Tennessee or Mexico.
"There is a scoreboard and it has Chicopee-one, Tennessee-zero, and Japan-zero as far as U.S. Tsubaki is concerned," Kos said.
The company makes timing drive systems for the top six North American auto manufacturers. The expansion will include a new research and development lab, administrative offices, and additional factory floor space.
" Give credit to U.S. Tsubaki, when they came here a dozen years ago, or so, theyplanned for the business to develop and grow," said Kos.
State and local tax incentives totaling more than $750,000 have been approved for the project.
Dan Butterfield, president of U.S. Tsubaki, said the incentives were one factor in the decision to expand in Chicopee rather than move south where labor costs would be cheaper.
"Total cost is more what we look at," he said. " Those costs include having the resources, and the employees with the skill levels. Timing is important. We are confident we can do the expansion here on time and that certainly played a big role in it."
He said the decision to expand in Chicopee was made by the directors of the parent company, Tsubakimoto Chain of Osaka, Japan.
Butterfield said the timing drive systems manufactured in Chicopee are assembled with parts built from scratch at the local factory and none of the work is outsourced.
Construction is expected to start later this year on the planned 100,000-square foot addition to U.S. Tsubaki’s 265,000-square foot building in the Westover Air Industrial Park.
Debra Boronski, Western Massachusetts Regional Director of the Massachusetts Office of Business Development, said the state’s Economic Assistance Coordinating Council voted in March to approve $525,000 in tax credits for U.S. Tsubaki for the Chicopee project.
"This is a way to help us to choose Massachusetts as a place to do business, or expand," she said.
The City of Chicopee approved a property tax abatement worth almost $250,000 over 10 years. Chicopee’s economic development director, Michael Vedovelli, said there is a clawback provision to the tax incentives if U.S. Tsubaki fails to create the new jobs it has promised.
" Typically cities do a five year ( tax break). We went to ten years because we believe in this project," said Vedovelli. " We wanted to make the case that Chicopee should be the location for this project."
In addition to the Chicopee manufacturing facility, U.S. Tsubaki has a warehouse in Westfield that employs 18 people.
Globally, Tsubakimoto Chain has over a 30 percent market share in the automotive timing chain business.