Kentucky Gov. Matt Bevin this week is outlining what he calls his vision for Kentucky, wherein the state would soon become a center for excellence in engineering and manufacturing, hedged partially on the successes of a booming aluminum industry.
Already, 40 percent of the aluminum produced in the U.S. is made in Kentucky, and, as gains in that industry continue, the state needs to market itself, he said, as a prime location for secondary applications — industries that fabricate aluminum into cars, trains, airplanes, kitchen appliances, electronics and more.
“There’s no state in America that has attracted more aluminum mills, steel mills, smelters (or) foundries than has Kentucky in the last couple of years,” he said. “Because, if we can get them here and we can produce the raw materials here, then the people who heat treat it, cold-roll it, hot-roll it, slit it, anneal it, fabricate it, bend it, weld it — that entire supply chain — are more likely to come here. It’s more likely to be here, because, from a logistical standpoint, the product itself is here. We’re right in the middle of America. We’re right, smack-dab in the middle of a nation that is the last geopolitical safe place on earth right now. There’s a lot of uncertainty in the world right now, and the United States and North America, while not perfect, are, relative to other places, pretty stable and pretty solid. That pendulum is coming back, and what a perfect time.”
The governor wrapped up a two-day community forum trip in western Kentucky on Tuesday. He spoke to a group of concerned citizens and civic leaders in Greenville on Monday night.
If the commonwealth can take advantage of financial incentives like international tariffs to produce local metal now, and do it successfully, he said, it could solve many of the problems the state faces today. Manufacturers buy massive amounts of electricity, which could provide a lifeline to a struggling utility market. More Kentuckians mean more tax dollars, which could revive pension funds and help fund infrastructure projects. Perhaps most important, he said, companies bring with them jobs, money and educational opportunities.
Should the governor’s vision come true, Owensboro is almost directly in the middle and almost exactly 30 miles away in each direction (east and west) from two of the nation’s largest aluminum smelters — Century Aluminum’s Hawesville and Sebree stations. If Kentucky’s regrowth depends on aluminum, wouldn’t Owensboro be a logical epicenter of that growth?
There’s no reason why any community couldn’t be, he said. He challenged the crowd in Muhlenberg County on Monday to think of a European country that is considered top-notch in engineering and manufacturing. Ninety-nine percent of the respondents of that question, he said, say Germany first and foremost. But if you were to identify a single U.S. state that can claim the same distinction, it becomes much more difficult to do, he said.
“Kentucky’s going to own it,” Bevin said. “That’s the vision. This is who we are going to be, (and) we already are in many respects. We already produce, per capita, more automobiles than anyone in America, No. 3 overall. (We’re) No. 2 in terms of production for aviation and aerospace. Pharmaceuticals, petrochemicals, pet foods and things of this sort, as you already know, are the kinds of things we’re already doing, in large measure.”
At an investment of more than $150 million, Century, which produces some of the world’s purest-grade metals in Hawesville, has committed to restart three of its idled potlines there. It’s a direct result, company officials say, of President Trump’s decision in March to apply heavy import tariffs on foreign aluminum competitors. Bevin also helped celebrate in June the groundbreaking of a $1 billion Braidy Industries aluminum rolling mill in Ashland.
A pendulum of growth has swung back in Kentucky’s favor, Bevin said, initiated partially by Trump’s pro-business agenda, and he said it’s his and his cabinet’s intention to take advantage of that.
Greater Owensboro Economic Development Corp. interim President and CEO Sharla Wells said Tuesday that she, too, believes the aluminum industry is a promising venture, especially for Kentucky. But she said she does not believe Owensboro should invest too much into any one single industry.
“We don’t want to put all of our eggs in one business, in case that boom doesn’t last forever,” she said. “But the aluminum industry does impact us directly here. We get trickle-off jobs and investment opportunities. Citizens right here in Owensboro are employed at nearby smelters.”
Mike Baker, director of the Hancock County Industrial Foundation, said a $400 million aluminum rolling mill expansion at Aleris Corp. in Lewisport could be the key behind even more Kentucky auto manufacturers. The annealing lines and wide cold mill there are producing a sheet metal product at the cutting edge of lightweight alloys used by parts suppliers. The Ford F-150, for example, is an all-aluminum pickup truck that couldn’t exist without bottom-end-chain suppliers investing in new technologies like that, he said.
“If you go back in the history of automotive companies in Kentucky, Toyota in Georgetown and Ford in Louisville grew alongside sheet rolling mills in the state,” he said. “Aleris is now producing that same kind of metal right here in Hancock County.”
The opportunity that poses for the western Kentucky region is what he called a shadow strategy. Western Kentucky has earned its fair share of supply base manufacturers — the people who produce smelt aluminum or roll it into sheets. Customers that buy those products or suppliers who help make them can build in western Kentucky, essentially in the “shadow” of Century, Aleris, or others.
Does that mean Owensboro is guaranteed the next automotive assembly plant in Kentucky? Certainly not, experts say, but it not only increases its chances by tapping into the aluminum boom, but it guarantees some spill-off in the form of byproduct jobs and opportunities.