3M to expand plant in Decatur
A planned $11.6 million addition to Decatur 3M Co. will generate $33,000 a year for Morgan County schools and allow the company to purchase more raw materials locally, the manager of 3M’s Decatur specialty film operations said.
Just as important, it will help secure jobs at the plant, Layland Watson said. The plant has 850 employees and 250 contract workers.
"It’s a great sign for Decatur that the corporation keeps investing in the plant," Watson said.
3M plans to begin construction next month, with completion scheduled for December 2012.
Watson said the addition will add a couple of employees, and will give 3M the ability to use different polymers in the production of the resin it uses to manufacture specialty plastic films. He would not name the local manufacturers of the raw materials because negotiations are ongoing.
"This is the sort of investment that flows down through the local economy," said Lynn Fowler, chairman of the Morgan County Economic Development Association. "It helps suppliers increase their business, and that creates more investments and more jobs.
"It creates confidence in the whole economy."
The end use for plastic films manufactured at the 3M plant includes clear coverings for cellphone displays, televisions and highway signs. Many of the films increase battery life and reduce power consumption in electronic devices by brightening displays.
The films also are used as reflective window coverings, reducing thermal heat while allowing light to pass through.
"It’s protecting jobs and hopefully growing our business," Watson said.
Producers are changing the way they produce the polymer 3M uses, Watson said, "and for us to adapt to that, we have to invest."
"It enables us to keep up with modern technologies, which keeps us competitive and keeps us as a low-cost provider," Watson said.
The news came the same day 3M reported a drop in corporate earnings, from $1.11 billion in the third quarter of 2010 to $1.09 billion in the quarter ending Sept. 30. One of the weakest areas, according to the company, was plastic films. 3M said makers of flat-screen TV sets are squeezing suppliers, frequently eliminating 3M films from their products to reduce costs. The display and graphics division, which includes the Decatur plant, had a 14-percent drop in global sales.
"While growth rates were good across much of our portfolio, LCD TV remained weak and momentum slowed in other parts of electronics following several quarters of very good growth," said George Buckley, chief executive officer of 3M.
Drop in Europe
3M experienced its worst drop in sales in Europe, where consumer confidence is low and government budget cuts are reducing demand for highway signs.
Fowler said it is increasingly difficult to jibe global and national economic woes with an accelerating local economy.
"You look around, and it’s hard to say the economy is bad here in Decatur," Fowler said.
Numerous industries in the Decatur area are in the midst of expansions or plant construction. Including Carpenter Technologies Inc., which last week announced it would build a plant in southern Limestone County, more than $1 billion is being invested in industrial construction projects.
In September, Morgan County’s unemployment rate was 9.4 percent. The statewide rate, not seasonally adjusted and thus comparable to the county rate, was 9.6 percent.
The national unemployment rate in September, not seasonally adjusted, was 8.8 percent.
In its filing with the Industrial Development Board, 3M said it would request $286,477 in noneducational property tax abatements over 10 years and an abatement of state sales-and-use taxes totaling $166,760.
Morgan County’s three school systems would divide an estimated $33,000 in annual property-tax revenue from the project and a one-time infusion of $109,570 in sales-and-use taxes generated during construction.