FRANKFORT, Ky. (July 11, 2023) – Today, Gov. Andy Beshear announced further growth of the commonwealth’s rapidly growing manufacturing and electric vehicle (EV) support industries as Hitachi Astemo Americas Inc., one of Kentucky’s largest Tier 1 automotive suppliers, announced an expansion of its operation in Madison County with a $153 million investment creating 167 new, quality Kentucky jobs.
“The unprecedented economic momentum we are seeing throughout Kentucky is not possible without growth from some of our largest industries,” said Gov. Beshear. “Manufacturing and the automotive sector have long been staples of the commonwealth’s economy, and with the rapidly growing EV sector bringing quality jobs and investments to our communities, we are setting Kentucky up for sustained success. I want to thank the leaders at Hitachi Astemo for their commitment to the commonwealth and look forward to their continued success in Berea.”
The project will see company leaders invest in the current manufacturing operation in Berea to support site improvements and renovations, including additional production lines and equipment in response to increased market demand and growth within the EV industry. Hitachi’s investment will create 167 full-time jobs for Kentuckians, bringing the company’s total Kentucky employment across the Harrodsburg and Berea facilities to over 2,100 workers.
“As we approach 40 years of manufacturing in this great state, we are pleased to continue our commitment to growing here in Kentucky,” said Tim Clark, president of Hitachi Astemo Americas. “This announcement is a bold step in the direction of vehicle electrification and embodies our new company name – Hitachi Astemo, which stands for Advanced Sustainable Technology for Mobility. Hitachi was founded on the basis of a pioneering spirit and being in harmony with society. This next generation of automotive technology allows us to further that ambition, and we are proud to be able to do that in Berea.”
In January 2021, Hitachi Automotive Systems, Keihin, Showa and Nissin Kogyo completed a business merger and began their journey as the global mega-supplier Hitachi Astemo. The company provides advanced mobility solutions in the areas of electric powertrains for automobiles, advanced chassis, autonomous driving/advanced driver assistance systems and systems for motorcycles. Headquartered in Tokyo, Japan, the company’s entry into the Americas began in 1972, with a Hitachi subsidiary established in Brazil. In the mid-1980s, Hitachi expanded into the U.S. market with its first factory in Kentucky. Today, the company serves as a global mega-supplier to some of the largest automobile manufacturers in the world and has more than 20 manufacturing sites in the United States, Canada, Mexico and Brazil, with two locations in Kentucky.
This expansion adds to Kentucky’s thriving manufacturing sector, which administration-to-date has seen nearly 600 private-sector new-location or expansion projects commit to invest over $22.9 billion and create more than 30,000 jobs.
Madison County Judge/Executive Reagan Taylor expressed his pleasure at seeing an existing company continue to grow and invest in the region: “We are thrilled for the city of Berea and all of Madison County that Hitachi Astemo Americas has decided to expand here. Their decision to expand the Berea facility speaks well for their existing facility, but also for the quality of life and strength of the community. Madison County is fortunate to have two thriving cities, and this announcement is another great example of good things happening because of positive relationships. We are always excited when new jobs are being created in Madison County and grateful for the hard work of Mayor Fraley and his team for continuing to cultivate the relationships to make Madison County better.”
Berea Mayor Bruce Fraley noted the decision by Hitachi to continue to invest in Madison County speaks to the talent of the local workforce and economic climate: “The city of Berea is very excited to see the continuing growth and success of our city’s largest employer, Hitachi Astemo Americas. The decision of a worldwide company to expand its Berea facility speaks well for their local employees, management team and the positive economic climate of Berea and Madison County. We value the long-term positive relationship with Hitachi, and are very happy to see a long-term, existing employer continue to grow as our city grows.”
Donna Angel, business development director for the Business and Economic Development Office of the city of Berea, highlighted the impact the investment will have to bring quality jobs and economic sustainability to the community: “The city of Berea is thrilled to see Hitachi expand here in our community. Hitachi Astemo is at the forefront of developing the newest technology in parts for automotive and other EV engines! This new line of services will not only enhance the automotive industry in the region but will highlight Berea and its various community strengths while offering important, quality jobs to our residents. This positions us for future economic growth and sustainability.”
Hitachi Astemo’s investment and planned job creation furthers recent economic momentum in the commonwealth.
Last month, Gov. Beshear announced there are more than 2 million jobs filled in Kentucky – the most in state history – according to the U.S. Bureau of Labor Statistics in its federal survey of business establishments. And the Governor highlighted that 57,000 new jobs have been filled since the beginning of his administration.
The Governor recently announced that Kentucky set the record for the longest period with the lowest unemployment rates in state history. On May 18, Gov. Beshear announced that Kentucky set a new historic low unemployment rate of 3.7%, which is the lowest rate ever recorded in the commonwealth.
Since the beginning of his administration, Gov. Beshear has announced more than 860 private-sector new-location and expansion projects totaling $26.8 billion in announced investments.
The robust job creation has been accompanied by rising wages across the commonwealth. The average incentivized hourly wage in 2022 was $26.78 before benefits, the second-highest mark since 2010 and an 11.5% increase over the previous year.
The Governor also secured the best two-year period in state history for economic growth and announced the two largest economic development projects in state history. In September 2021, Gov. Beshear and leaders from Ford Motor Co. and SK On celebrated a transformative $5.8 billion investment that will create 5,000 jobs in Hardin County. In April 2022, the Governor was joined by leadership at AESC to announce a $2 billion investment that will create 2,000 jobs in Warren County. These announcements solidify Kentucky as the EV battery production capital of the United States.
That position was strengthened even further in May 2023, when the Governor and leaders at Toyota announced a $591 million investment across multiple projects as the company’s largest manufacturing operation in Georgetown introduces its first battery electric vehicle. Growth within the EV sector continued into June as Gov. Beshear joined INFAC North America to break ground on the company’s $53 million investment to support EV-related production in Campbellsville.
Over a two-month period this year, Kentucky secured two credit rating increases from major agencies. On May 12, Gov. Beshear announced that his administration obtained the first state-level credit rating upgrade in 13 years and the first-ever upgrade from Fitch Ratings. On June 29, Gov. Beshear announced the commonwealth received its first-ever rating increase from S&P Global Ratings.
Site Selection magazine recently placed Kentucky first in the South Central region and top-5 nationally in its 2023 Prosperity Cup ranking, which recognizes state-level economic development agencies for their success in landing capital investment projects. The publication also placed Kentucky second nationwide and first in the South Central region for its annual Governor’s Cup ranking for 2022, which recognizes state-level economic success based on capital investments.
Gov. Beshear’s administration is projected to post the four highest years of budget surpluses in Kentucky history. Just yesterday, the state reported receipts for fiscal year 2023 totaling $15.1 billion, which exceeded budgeted estimates by $1.4 billion, making it the largest revenue surplus in history.
Gov. Beshear recently announced a new “Supply Kentucky” initiative with the goal of boosting job growth, reducing costs and providing more security in the supply chains of our Kentucky companies.
To encourage investment and job growth in the community, the Kentucky Economic Development Finance Authority (KEDFA) in March 2023 preliminarily approved a 10-year incentive agreement with the company under the Kentucky Business Investment program. The performance-based agreement can provide up to $2.4 million in tax incentives based on the company’s investment of $153 million and annual targets of:
- Creation and maintenance of 167 Kentucky-resident, full-time jobs across 10 years; and
- Paying an average hourly wage of $25.71 including benefits across those jobs.
Additionally, KEDFA approved Hitachi Astemo for up to $200,000 in tax incentives through the Kentucky Enterprise Initiative Act (KEIA). KEIA allows approved companies to recoup Kentucky sales and use tax on construction costs, building fixtures, equipment used in research and development and electronic processing.
By meeting its annual targets over the agreement term, the company can be eligible to keep a portion of the new tax revenue it generates. The company may claim eligible incentives against its income tax liability and/or wage assessments.
In addition, Hitachi Astemo can receive resources from Kentucky’s workforce service providers. Those include no-cost recruitment and job placement services, reduced-cost customized training and job-training incentives.
For more information on Hitachi Astemo Americas Inc., visit hitachiastemo.com.
A detailed community profile for Madison County can be viewed here.
Information on Kentucky’s economic development efforts and programs is available at CED.ky.gov. Fans of the Cabinet for Economic Development can also join the discussion at facebook.com/CEDkygov, on Twitter @CEDkygov, Instagram @CEDkygov and LinkedIn.
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