- Associated Press - Monday, September 22, 2014

FRANKFORT, Ky. (AP) - A Japanese metalworking company said Monday it plans to spend $8.6 million and hire 30 people to open a plant, joining a growing number of Japanese businesses that have come to the state following Toyota’s decision to put its largest North American plant in Kentucky.

Kowa Kentucky, a wholly owned subsidiary of Kowa Kogyosho, announced it would open a plant in Knox County, where the unemployment rate is 10.7 percent. The company plans to have its facility open by August and will begin production in January 2016.

The company will work on pipes used in Toyotas to prevent fuel from corroding them.

Kowa Kentucky is one of more than 160 Japanese companies that have opened in Kentucky since Toyota announced its investment in 1986. Altogether, those companies employ more than 43,000 people, or about 3 percent of Kentucky’s workforce.

Last year, trade between Kentucky and Japan surpassed more than $1.2 billion, Democratic Gov. Steve Beshear said. And in the past two years, 52 Japanese companies have invested $1.3 billion in Kentucky. Per capita, only Hawaii has had more investment from Japan, according to Larry Hayes, secretary for the Kentucky Cabinet for Economic Development.

State officials say the state’s relationship with Japan first bloomed with Toyota, which opened its plant in Georgetown in 1988 and now employs more than 7,000 people. Since then, the plant has produced more than 10 million Toyota Camrys. Next year, the plant will begin building the Lexus ES 350, the company’s first luxury vehicle to be made in the United States.

Hayes said Kentucky has benefited from Toyota suppliers, which was one reason Kowa Kogyosho officials said they wanted to put a facility in North America. Aside from supplying Toyota, officials said they have plans to expand to other businesses.

“Our purpose of founding Kowa Kentucky here in the U.S. is to serve many other companies that we will be asked to supply in the near future,” said Kimihiro Nakano, vice president for Kowa Kentucky, said through an interpreter.

State officials have approved state tax incentives worth up to $600,000 depending on the number of jobs the company creates and how much money it invests. The company could also recoup up to $50,000 in sales and use taxes on construction costs.

The announcement was also a victory for eastern Kentucky, which has struggled to replace job losses in the declining coal industry. The region has lost about 7,000 coal-related jobs since January 2012. Kowa Kogyosho officials said they also considered Knoxville, Tennessee, before settling on Corbin in Knox County.

“I instantly fell in love with Kentucky, a beautiful state in wonderful harmony with mother nature,” Saetsu Sato, president of Kowa Kentucky, said through an interpreter. “My love for Kentucky has grown more and more.”


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