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Carbon Motors chooses Connersville

July 29, 2009

Carbon Motors this morning officially selected Connersville for its proposed headquarters and manufacturing operations.

The Atlanta-based startup maker of high-tech police cars intends to invest $350 million to locate its production headquarters in the 1.8-million-square-foot facility formerly occupied by Visteon. The company said it could create 1,550 jobs within three years.

The developer of a high-tech cruiser that runs on clean diesel and biodiesel technology chose Indiana over cities in Georgia and South Carolina. The company says it already has orders for 10,000 cars.

“If there’s a place that deserves the boost that Carbon Motors just gave, it’s Connersville,” said Gov. Mitch Daniels, who attended the announcement.

The Indiana Economic Development Corp. said it has not yet ironed out details of the incentive package it will offer Carbon Motors.

“The IEDC must resolve outstanding contingencies with the company before agreements are finalized, including site-acquisition complexity brought about by Visteon's recent bankruptcy, latent environmental concerns at the vacant facility and finalizing terms of an agreement which will protect Hoosier taxpayers and give Carbon Motors the opportunity to effectively compete for federal funding,” it said in a press release.
 
Carbon Motors said it will apply for a federal loan through the U.S. Department of Energy's Advanced Technology Vehicles Manufacturing Loan Program. Final selection of a manufacturing site is a condition for Carbon Motors to make the loan application.

The federal program provides loans to automobile and parts manufacturers for the cost of re-equipping, expanding or establishing U.S. manufacturing facilities to produce advanced-technology vehicles or qualified components, the IEDC said.

One of Connersville’s greatest assets is the former Visteon plant. The city is in the process of purchasing the massive building that sits on 187 acres out of bankruptcy, Connersville Mayor Leonard Urban said.

The city could sell the plant to Carbon Motors “very inexpensively” or “maybe even give it to” the company, he said.

“If they chose us, they could start to work immediately,” Urban said yesterday.

For Fayette County, where the unemployment rate is almost 16 percent, landing the company is a huge coup.

“Certainly in this economic climate, any project that is going to create 1,000-plus jobs is enormous,” said Jay Walters, president of Indianapolis-based Bingham Economic Development Advisors LLC. “It’s pretty apparent by the enthusiasm and the community support that is pouring out what type of impact it could have on the community.”

Despite the enthusiasm, Carbon Motors is not a sure thing. The company is a startup and has yet to begin production of any vehicles.

“As exciting as this is, as thrilling as this is, let’s keep our heads. There’s lots of work to be done,” Daniels said this morning.

As of April, the company was trying to raise enough money to build five cars for crash testing, according to Raymond Wenig, president of Savannah, Ga.-based Ariel Savannah Angel Partners, one of the company's financial backers.

Wenig's investment group has plowed more than $400,000 into Carbon Motors, but he acknowledged it must clear several more hurdles before its E7 police car becomes a reality. One will be the safety-approval process.

Stacy Dean Stephens, a co-founder of Carbon, told IBJ in April that Carbon Motors consists of eight people, including the co-founders and some contractors. The team would begin in the new location with about 200 employees.
 
Carbon Motors is the brainchild of former Ford executive William Santana Li. If produced, the E7 would compete with Ford's own Crown Victoria, the most widely used police car.

The E7 appeals to cops with high-tech gadgetry and a design that caters to their driving habits, which include hitting curbs at 55 mph and crossing medians, said Stephens, a former police officer. Meanwhile, the company hopes budget-minded police administrators will like the fuel-efficient diesel engine.

About 75,000 patrol cars are sold each year, but Carbon Motors needs to capture only a small fraction of that market to survive, Wenig said.

Carbon Motors has been taking its drivable prototype around the country, and so far, cops are enthusiastic.

Wenig likes that Carbon Motors plans to keep control of every car it sells. There will be no police auctions for the E7. Each one will either be refurbished or destroyed.
 

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