State of the parts.

• Author: Perkins, David
• Position: Getrag Gears of North America - Company profile

STATE OF THE PARTS

Five years ago, Tobias Hagenmeyer had a decision to make.

His Getrag Gears of North America, which manufactures timing gears for Ford, BMW and other automakers, was dissolving a partnership in Norristown, Pa. Searching for a new plant site, he was leaning toward moving nearer Detroit, possibly to Indiana. Then an old friend suggested he look the other way: to Rockingham.

"I told him on the phone that we've got the best workers in North Carolina," says Harry Smith, vice president and general manager of, GKN Automotive Co.'s plant in Sanford. "I said, "Send someone down, and I'd show him around.'" British-owned GKN, which makes constant velocity (CV) joints, had picked Sanford for its first U.S. plant five years earlier. It had done so well that GKN built one in Mebane a year later.

In the end, Hagenmeyer chose a site in Newton, near Hickory, about an hour's drive from Charlotte/Douglas International Airport. A year later, the $45 million, 240-job Getrag plant was turning out timing gears and transmissions for Detroit's Big Three. But its largest U.S. customer - Consolidated Diesel Co. - is in Whitakers, near Rocky Mount.

"We wanted to be close to Consolidated Diesel," says Vice President Guenter Venneman. "We wanted to be in a right-to-work state. We wanted to be where weather conditions weren't severe. Charlotte met all those needs."

It used to be, when the world thought of the auto industry, it looked one place: to Detroit. But that was before U.S. automakers began pulling up stakes a decade ago and heading south to build new, automated plants. The Japanese, anxious to skirt trade quotas and defuse hostility, followed them: Nissan in Tennessee, Toyota in Kentucky and Honda in Ohio.

North Carolina didn't court the big assembly plants General Motors, Toyota and Nissan built in the 1980s. State officials frankly admit they didn't - and still don't - want big unionized plants and large numbers of workers subject to layoffs. "We competed for GM's Saturn plant, but even then, it was with the understanding that we'd rather have [the smaller companies] that come with the plant than the assembly plant itself," says Alvah Ward, director of the business-industry development division of the N.C. Department of Community and Economic Development.

And that's what the state has attracted. Since 1985, 46 parts makers have moved to North Carolina. Most of the new plants have fewer than 200 employees. But they helped create 4,400...