Aspen Aerogels Inc. revealed in a Wednesday, Feb. 12, investor and public relations statement that it has halted construction on the production plant it broke ground for in Bulloch County’s I-16 interchange commerce park over two and a half years ago.
This means that 250 manufacturing jobs originally announced for the plant won’t be created here, but it also comes after a boom in construction of other manufacturing plants in the region led to predictions of a tight labor market.
Headlined “Thermal Barrier Supply and Statesboro Plant Project Update,” Aspen’s statement appeared in the middle of an otherwise mostly upbeat news release on the company’s fourth-quarter and fiscal year 2024 performance, which preceded a Thursday morning financial results conference call.
That portion of the report opened by announcing that the company “will invest to maximize capacity” at its original East Providence, Rhode Island, manufacturing plant and “utilize a flexible supply strategy.” This passage also mentioned the use of an “external manufacturing facility” – which generally means contracted rather than company-owned – to increase aerogel production.
“Accordingly, Aspen has stopped construction of its planned second aerogel manufacturing facility in Statesboro, Georgia,” the release stated. “The Company will be assessing options to derive value from the assets in Statesboro, including relocating some equipment to upgrade and expand its existing plant. This path requires minimal capital.”
3 years to full stop
Three years ago this Monday, on Feb. 17, 2022, Georgia Gov. Brian Kemp announced that Aspen would build a $325 million plant in what was then called Southern Gateway Commerce Park, off U.S. Highway 301 at the I-16 interchange between Statesboro and Claxton.
Company officials at the time projected the plant to be in operation by late 2023 and that it would create at least 250 advanced manufacturing jobs. Later renamed Bruce Yawn Commerce Park, the larger park has since become home to Ajin Georgia, a metal auto body parts factory that was completed and is supplying parts to Hyundai Motor Group Metaplant America, the huge new electric vehicle manufacturing complex in Bryan County.
Unlike Ajin and SECO Ecoplastic, whose injection-molded auto parts factory is on U.S. Highway 301 south of Statesboro and which has also started parts production, Aspen’s plant was never intended as a direct supplier to Hyundai.
But Aspen Aerogels’ corporate leaders did link their reasons for expanding beyond their original plant in Rhode Island to expected demand for aerogel material as thermal insulation in and around the batteries of electric vehicles, or EVs.
Outsourcing instead
The specific statement within the news release on Wednesday quoted Aspen Aerogels’ Chief Financial Officer and Treasurer Ricardo C. Rodriguez.
"In early 2023, pre-empting a reset in EV demand expectations, we decided to right-time the construction of our planned second aerogel manufacturing facility in Statesboro, Georgia and subsequently ramped up our external manufacturing capacity for our Energy Industrial business,” he said.
The “right timing” decision he referred to reflects a previous delay in the scheduled completion of the plant. Although buildings were taking shape at the site by the time of a February 2023 update in the Statesboro Herald and were described as “nearly complete” in June 2024, production never began.
“In this most recent quarter, the external manufacturing model has fully demonstrated its ability to efficiently increase aerogel supply,” Rodriguez continued in the corporate release. “We are confident that a capital-light and modular capacity plan provides the most efficient path to creating value.”
In April 2022, Aspen executives visiting Bulloch County had suggested that the predicted 250 advanced manufacturing jobs and $325 million investment were only the first phase. The plant was designed to be expandable, with utilities and infrastructure to support a second or even a third phase, they said initially.
The Development Authority of Bulloch County was providing a 90-acre site within the commerce park free-of-charge to Aspen Aerogels. That aspect of the offer changed with the DABC’s subsequent deals for other manufacturers, who were provided land at a discount, but not for free.
But as with the other plants, state and local incentives, including the use of the land and Bulloch County’s partial 10-year waiver of property taxes, came with requirements that job-creation goals would be met. With the land technically still belonging to the tax-exempt Development Authority, the tax waiver is made to apply to the county government maintenance and operations portion of the tax millage, but companies are required to make a “payment in lieu of taxes” equal to the fire protection and school tax rates.
DABC ‘disappointed’
Phoned Thursday, Development Authority of Bulloch County CEO Benjy Thompson said he still didn’t know whether the announced halt in construction is necessarily permanent but that the DABC must proceed as if it is.
He then supplied a typed statement on behalf of the authority.
“Businesses often re-evaluate their strategies,” the statement began. “We are certainly disappointed that Aspen Aerogels has indicated it will cease construction of the planned advanced manufacturing facility in Bulloch County.
“Taxpayer protection is a priority, and should the project not move forward any further, clawback provisions are in place to recoup the local investment,” the statement continued. “Moving forward, the Development Authority, our local and state partners, along with those who make economic development projects possible, will continue to pursue long-term projects that bring good jobs, smart investment, and economic opportunities to the citizens of Bulloch County.”