With support from Investe SP, Cummins will build new BRL 90-million factory in Itatiba
The company will expand its production with a new plant in the municipality of Itatiba, which will receive a unit of generator sets and part and equipment distribution center.
Governor Geraldo Alckmin signed a memorandum of interest with Cummins Brazil in the late afternoon on Tuesday, March 27. The document sets forth an investment of about USD 90 million in the construction of the company’s new factory for the production of generators in the municipality of Itatiba, 86 km from the capital.
Alckmin highlighted the importance of expanding the availability of qualified labor to meet the growing demand from companies like Cummins. "We already have a Fatec (Technology University) in the region and will install an Etec (State Technical School). We will also extend the available engineering courses at State universities”, he said.
The ceremony was attended by State Secretary of Economic Development, Science and Technology, Paulo Alexandre Barbosa; the President of Investe São Paulo, Luciano Almeida; the Mayor of Itatiba, John Fattori; and Chief Executive Officer of Cummins in Brazil, Luis Alfonso Pasquotto.
Currently, Cummins’ unit of generator sets is located in one of its three factories in Guarulhos, where engines and turbos are manufactured. With the change, the line of engines and turbos gets more space and can be modernized. The expectation is that, until 2015, approximately BRL 48 million are invested in Guarulhos.
The work of Investe São Paulo
Investe São Paulo, which is a state government agency responsible for attracting and maintaining investment in the State, serves Cummins as of May 2011, advising the company, at no charge, in the search for a location for the new venture. “The Government of São Paulo, via Investe SP, provided all support so that this investment could remain in the State. The city of Itatiba counts on excellent logistics for the outflow of production and skilled labor”, explained State Secretary of Economic Development, Science and technology, Paulo Alexandre Barbosa.
For the chairman of Investe SP, Luciano Almeida, the work of the Agency is just beginning. “Now that the company has chosen the city and acquired the area, let's start the group work for obtaining permits and contacting the dealers of the region's transport and power distribution companies”, he said.
Cummins has provided an account of the project needs so that Investe SP could identify the regions of the State capable of meeting the investment demands. The company opted for the municipality of Itatiba after receiving a list of cities that fit in the demands of the venture. "The work of Investe SP has made all the difference. The advice, follow-up and professionalism dealing with the issue have intensely contributed for the successful attraction of this investment, as well as the collaboration of the Department of Economic Development, Science and technology”, said the Mayor of Itatiba.
“The arrival of the American multinational Cummins in Itatiba effectively confirms the result of all investments proposed by this Administration for our city to become attractive to considerable investments. It represents an enormous economic progress that is justified, among many reasons, on the incentives generated through Progride (Economic development incentive program), in addition to the quality of life and labor offered in the municipality”, added Fattori.
In 2010, the City Council, by means of a law, introduced the Progride program. The initiative provides incentives for new companies to be established in the city, aiming at the increase of income and employment generation.
The new unit of Cummins in Itatiba
It is estimated that the new industrial plant, located on the banks of Dom Pedro I Roadway, by KM 97.5, is ready in March 2014, generating 250 direct jobs, with a potential to reach 700 employees in the years following the opening of the manufacturing unit. The plant will receive first unit of generator sets and Cummins’ part and equipment distribution center.
When the new factory is fully operational, it will be capable of producing about 12 thousand power generator units and 1.2 million components or subsets per year.
The land of Cummins’ new plant counts on 436 thousand m² and will initially comprise a built-up area of approximately 50 thousand m². The land and infrastructure projects will require investments in the order of USD 37 million. The remaining value will be applied to the construction of the factory.
“The initial investment in civil construction already covers the earthworks, and will include a plateau with 347 thousand m². Therefore, at that stage, we are using less than 15% of the available area. The remainder will be used in future steps of the company's expansion”, said the project's Executive Manager of Cummins, Francisco Silva.