In The News
Advanced Manufacturing on a Roll in Virginia
If and hopefully when U.S. manufacturing enjoys a full-fledged renaissance, economic development officials in Virginia believe their state — oops, commonwealth — will be right in the thick of it.
“Virginia’s future in advanced manufacturing will lead the way in the rebirth of American manufacturing,” predicts Liz Povar, director of business development for the Virginia Economic Development Partnership.
Povar and other officials around the commonwealth have good reason to be confident.
Rolls-Royce Group recently selected Prince George, Va., as the site of its first greenfield manufacturing plant in the United States.
When the 180,000-square-foot plant officially opened in May, Rolls-Royce North America CEO James Guyette called it “a flagship operation for Rolls-Royce around the world.”
“The future of advanced manufacturing is here, and it’s beginning in Virginia,” Guyette said in May. London-based Rolls-Royce has maintained its North American headquarters in Reston, Va., since 1990.
The Prince George plant makes rotating discs for Rolls-Royce turbofan engines, which are designed for Boeing 787 Dreamliners, Airbus 380s, Airbus A350 XWBs and other jets.
Rolls-Royce located the facility on a 1,000-acre site — dubbed the “Crosspointe Campus” — to allow the company plenty of room to add manufacturing space or co-locate suppliers and business partners there in the future.
The campus also is the future home of the Commonwealth Center for Advanced Manufacturing, an applied-research center funded through a public-private partnership that includes some of Virginia’s marquee manufacturers — such as Rolls-Royce, Canon, Siemens and Huntington Ingalls Industries — as well as Virginia Tech and the University of Virginia.
Scheduled to open next fall, the 50,000-square-foot center “will be a game-changing research facility,” asserts Thomas Loehr, Rolls-Royce executive vice president, Crosspointe.
“Its mission is to deliver step-level improvements in manufacturing technologies,” Loehr says. “This is applied research, so it will result in significant cost reductions in the way you manufacture product, and it will gives its members competitive advantage.
“Additionally, I think it has a very powerful value proposition in that it aggregates the technological interest across its members, so the research activity becomes more affordable, and it better leverages the value for money spent.”
The creation of the applied-research center was key to the economic development deal that brought Rolls-Royce to Prince George, Povar notes.
“Our ability as a commonwealth to think differently about the investment that we were going to make and think about the company’s need for support in innovation — rather than just offer traditional incentives — resonated very well with them,” Povar says.
The center could be key to more economic development deals in the future, as Povar believes it will be a “magnet” for advanced manufacturing. But Virginia’s innovation infrastructure is just one of four major selling points — or “legs of the table,” as Povar puts it — that the state emphasizes to manufacturers such as Rolls-Royce.
Those legs of the table — innovation, predictability, educational attainment and access to global markets — “are really what define us and have defined us since they first landed here in Jamestown,” Povar says.
Virginia’s predictability encompasses a corporate income-tax rate that hasn’t changed in three decades, Povar explains, and unemployment-insurance and workers’ comp rates that consistently rank among the lowest in the nation.
Seemingly just as predictable is Virginia ranking No. 1 or No. 2 in CNBC’s America’s Top States for Doing Business report, which judges states across a matrix of metrics that includes access to capital, quality of life and cost of doing business. Virginia took the top spot in 2011 and 2009, and garnered the No. 2 spot in 2010 and 2008.
The commonwealth’s military presence, which includes Langley Air Force Base, Fort Lee and Marine Corps Base Quantico, gives Virginia good reason to tout the high educational attainment of its workforce.
“The technical skills and talent of nearly 20,000 exiting military [personnel] every year can be applied in Virginia’s advanced-manufacturing community,” Povar says.
Meanwhile, the state offers access to global markets via the Port of Virginia, which boasts the deepest channels on the East Coast; more than 3,100 miles of Class 1 railroads; and Dulles, Richmond and Norfolk international airports.
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Virginia’s largest employer is Huntington Ingalls, whose Newport News Shipbuilding division employs more than 20,000 people at its sprawling facilities along the James River.
The commonwealth also has a bustling food and beverage cluster in the Shenandoah Valley, with companies such as Nestlé USA and MillerCoors operating there.
Economic development officials see promise in the commonwealth’s aerospace cluster, with Rolls-Royce as an anchor and other notable companies including Northrop Grumman Corp., which moved its corporate headquarters from Los Angeles to Falls Church, Va., in late August.
The commonwealth also hopes clusters will emerge in two other areas — offshore wind and commercial-space flight — that could lead to more advanced-manufacturing activity.
“The curvature of our oceanfront allows some of the highest consistent wind speeds in the Atlantic over our shores,” Povar says. The commonwealth is working with a private firm to set up test turbines to validate that assertion, she adds.
Economic development officials hope the NASA Goddard Space Flight Center’s Wallops Flight Facility on Virginia’s eastern shore, and the area around the facility, could be a launching pad for commercial space-flight research and manufacturing.
A cluster in commodity manufacturing, however, is unlikely to emerge.
“We’re never going to be the commodity manufacturing leader. We don’t want to be,” Povar says. “But we do want to be the advanced manufacturing leader … and we intend to make sure that message is out there in the marketplace.”
– Industry Week, by Josh Cable, September 02, 2011