AZ Big Media Could Pinal County Become the Detroit of Electric Vehicles?
With sky-high fuel prices draining the wallets of commuters across the state and country, the prospect of electric vehicles (EVs) looks even more appealing than it did back when a gallon of gasoline cost less than $3. And Pinal County is positioning itself to become the Detroit of electric vehicles.
However, many electric vehicle options defy the “affordable” label, and the limited availability of one of the biggest brands in the market segment – Tesla – often puts consumers at the bottom of a long waiting list.
READ ALSO: Here’s why Pinal County is about to experience a development boom
That said, all signs point to the electrification of the automotive industry. On August 5, 2021, the Biden administration released a statement from three major automakers:
“Today, Ford, [General Motors] and Stellantis announce their joint aspiration to achieve sales of 40-50% of annual U.S. electric vehicle sales (battery electric vehicles, fuel cell and plug-in hybrids) by 2030 to bring the nation closer to a zero emissions. with the Paris climate objectives. Our recent announcements of products, technologies and investments underscore our collective commitment to be leaders in America’s transition to electric vehicles.
Drive for leadership
With the Build Back Better plan seemingly dead, some federal provisions are stalled, such as incentives to expand electric vehicle manufacturing and supply chains in the United States, but automakers are still making progress.
“The same talking points are shared between the industry, state and federal level. They’re all connected, and I think that’s the biggest sign of commitment and skill. These market segments kind of hum to the same tune,” says Britta Gross, CEO of the Rocky Mountain Institute and Orlando Public Utilities Commissioner, during a panel discussion on Arizona Forward on Feb. 1, 2022. “Electric vehicles are coming, and we are debating among ourselves whether they will arrive in large numbers in 2025, 2028 or 2030.”
With electric vehicles inevitably making up a large share of car sales over the next decade, the race is on for cities across the United States to benefit from this growth. Gross, who worked for GM for nearly two decades, notes that automakers consider many factors when choosing locations for manufacturing facilities, such as the business environment and land availability, which she says in Arizona.
“But colocation and proximity matter too,” Gross says. “Collocation is a big deal for automakers because it means they have access to the right workforce and skills. Proximity is a cost saving since it’s cheaper to move things like test vehicles and batteries. There is a great need for domestic production not only of vehicles and batteries, but also of charging infrastructure. Don’t overlook these great opportunities for anyone [components] who go into charging equipment to come from Arizona, because today most come from overseas.
The electric vehicle industry has taken root in Arizona, with companies such as UACJ Whitehall creating parts for electric vehicles in Flagstaff, KORE Power building batteries in Buckeye, and ElectraMeccanica manufacturing its single-seat electric vehicle in Mesa.
Cities in Pinal County have also benefited from car electrification, with several large facilities picking the area and positioning it as a powerhouse for years to come.
Choosing Pinal County for Electric Vehicles
On November 29, 2016, Governor Doug Ducey and Lucid Motors announced that the company had chosen Casa Grande after a nationwide search of 13 states and 60 locations. It was expected at the time that over 2,000 new jobs would be created and the facility would generate over $700 million in capital investment by 2022. Then, in 2021, Lucid announced that it would expand its 2.85 million Casa Grande manufacturing plant. square feet. The increased capacity will create approximately 6,000 direct jobs with an economic impact of over $100 million by 2030.
About two years after Lucid’s initial decision to locate in Casa Grande, another electric vehicle manufacturer chose Pinal County. Located on a 430-acre parcel in Coolidge, Nikola’s 1 million square foot facility builds electric tractor-trailers with the goal of transforming the transportation and logistics industry. The plant is expected to produce 2,500 trucks in 2022 and will increase to 20,000 trucks per year once phase two of the facility is complete.
“With the expansion of Nikola and Lucid, we feel like we’re becoming the epicenter of electric vehicles – certainly in Arizona, if not nationally,” says James Smith, director of economic development and workforce. work for Pinal County. Moreover, as companies such as Lucid and Nikola double down on their investments in Pinal County, other companies can take advantage of the industrial cluster that is forming.
The recent announcement of LG Energy Solution’s cylindrical battery plant in Queen Creek is an example of this dynamic. The batteries that will be manufactured on site offer compact, high-density energy storage, ideal for electric vehicles. The $1.4 billion facility will be the first of its kind in North America and is expected to employ up to 2,800 people.
“As you can imagine, these international ventures are extremely competitive,” says Sandra Watson, president and CEO of the Arizona Commerce Authority (ACA). “Arizona offers – I would say – the best business climate in the country. We are fortunate to have great leaders like Governor Ducey creating the conditions for this type of investment. [that] allows us to market and sell Arizona in ways that others cannot.
A balanced and comprehensive strategy that not only focuses on incentives, but also on investing in modern infrastructure, affordable energy and implementing regulations that are not overbearing is paramount to attracting these businesses that will benefit communities. in which they reside, according to Watson. The ACA has other tools, however, to attract companies large and small.
“We administer all of Arizona’s economic development financial programs. We have tax credits that we are able to offer [and] tax policies we share with businesses to better inform them on how to calculate [potential] tax benefits,” Watson continues. “What our legislators have done in Arizona is consider opportunities to improve business growth in a fair and equitable way. And that means establishing programs that apply to all businesses.
Workforce Wish List
As companies research potential sites, several criteria factor into the decision to innovate in one location over another. Pinal County benefits from access to two major highways and the Union Pacific mainline, as well as the region’s proximity to California ports and the Mexican border. Tax benefits are another carrot that economic developers can use, but ultimately businesses need access to their most valuable asset: employees.
Richard Wilkie, director of economic development for the town of Casa Grande, explains the importance of having a talent pool in place when it comes to manufacturing electric vehicles in Pinal County. “[Lucid] is a start-up, so they wanted to make sure they had made the right decision about where they were going to locate. They spent months and months looking at the workforce,” he says. “They anticipate over 6,000 people working for them. [Lucid] wanted to make sure that they were going to meet not only the immediate needs, but also the future needs of the business, and concluded that the workforce is as good as anywhere you are going to find in Arizona.
With Pinal County located between two major research universities – Arizona State University and the University of Arizona – electric vehicle manufacturers have access to a steady supply of college-educated talent. Not only that, but as these companies continue to come together, newcomers can tap into an existing labor pool that already has the skills needed for the job.
State leaders realize how critical a highly skilled workforce is to growing the economy and opened Drive48 in Coolidge last year.
“Drive48 was developed with a focus on collaboration, bringing together our community college system, along with industry leaders to develop specific job training opportunities to accelerate and improve hand training. throughout Arizona,” Watson said. “This is an important opportunity to show industries across the country that Arizona is working hand in hand in a collaborative way to ensure they have the talent they need to succeed.”
The partnership between the state, Pinal County, Casa Grande and Central Arizona College has already paid off. Watson notes that 1,700 Pinal County workers have already been trained, helping Lucid meet its production schedule. The goal is to build six more of these state-of-the-art facilities across the state.
“[Drive48] is fully utilized by Lucid,” adds Wilkie. “They have different types of training in what they call dojos, which are basically separate classrooms. It’s flexible, so if they need to change the lineup in the future, it’s easy to do.
Watson concludes: “I am pleased to report that the model is considered a national model. Other states and labor groups have told us about how we have been able to establish [Drive48]. I imagine we’re going to see a number of these replicated across the country, because that’s really what the future of workforce training will look like.