Editorial: Tire deal a blowout?
When Continental Tire chose South Carolina as the site for a $500 million tire plant, North Carolina’s top Democrats and Republicans leapt to blame one another for botching the deal that might have brought the plant to this state.
Senate leader Phil Berger said the tiremaker was repulsed by political cronyism, pointing out that the N.C. site under consideration is owned by a Democratic legislator and some Perdue donors, and that a law firm employing Perdue’s son was involved. In response, Perdue said she had nothing to do with picking the site — which Continental chose from a list supplied by N.C. development officials. Disclosure reports by the law firm do not list her son as working on the project.
Instead, Perdue fired back, the state lost the deal and the 1,300 jobs it would have brought to Brunswick County because Republican legislative leaders balked at the company’s demands for a $100 million incentives package that would have included $45 million up front, when the state initially offered “only” $30 million up front.
While corporate executives don’t want important projects to become entangled in political warfare, it’s hard to make the case that South Carolina offers a less controversial business or political climate than North Carolina. The Palmetto state is currently in the middle of a dust-up between Boeing and federal officials who allege the jetliner maker broke labor laws to open a plant in right-to-work South Carolina. The case has become a proxy political battle, with some Republicans contending the Obama administration is using it to curry favor with unions. Then, there’s the perennial controversy over the Confederate flag, which continues to fly at the Statehouse and has provoked several boycotts, incuding a decades long ban on NCCA tournaments. It’s hard to see South Carolina as a state where politics and business never meet.
What is clear is that South Carolina has developed into a tire-industry hub, becoming the nation’s top employer of tire workers and bringing in almost $2 billion in new investment. In September, Bridgestone announced it would invest $1 billion in two Aiken County projects. Michelin and Tire International, a tire recycler and manufacturer, also announced South Carolina plants earlier this year. Just two years ago, Continental moved its Charlotte headquarters across the state line.
Corporate decisions inevitably involve many factors, including geography, transportation facilities, workforce availability, tax rates and other business costs — and incentives. Obviously, South Carolina has developed a strong support network for tire makers. Top S.C. officials were also on the same page regarding the package offered to Continental. Haley credited teamwork as a key factor in the deal. That’s something North Carolina officials should think about when the next potential jobs generator comes rolling along.