Foreign Investment into Tennessee 2018
Tables and Graphs
In 2018, for the fourth time in five years, Tennessee attracted over $1.5 billion in new foreign investment. Eighteen foreign-owned firms headquartered in 12 different countries opened new facilities or expanded existing operations during the year. This is creating just over 3,000 new jobs. See the accompanying map for the locations of these investments.
The total announced investment was smaller than that of 2017. However, that 2017 amount was the highest in a decade. A stronger dollar and, for all practical purposes, the end of Chinese investment were two significant forces behind the $600 million dollar decline. Volkswagen's $340 million investment to launch its new five-seat Atlas SUV was the single largest investment of the year. However, close behind was the $301 million expansion of Nidec’s electric motor plant in Lexington. In terms of employment, the most significant new investment was in Morristown, by Van Hool (from Belgium). Its new vehicle plant will employ 640 workers.
As per usual, the automotive sector dominated the investment picture. Eight of the new investments are related to auto manufacturing. Almost two-thirds of the dollar value of the 2018 foreign investment into this state was in this sector.
Japanese firms, also as per usual, made more investments than any other country. Five investment decisions, amounting to $632 million, came from Japan. Though the dollar value of these investments was quite a bit less than in 2017, this is only because of the extraordinary $1 billion investment by Denso in that year. For the second year in a row, Canadian investment was unusually light. Just two Canadian firms announced investments in Tennessee last year. This is likely due to the continued weakness of the Canadian dollar. As a footnote, in April, Mobile Mentor announced it would open operations in Nashville, making it the first New Zealand-owned company operating in Tennessee.
Due to the government shutdown, figures for the entire U.S. will be delayed. But through the second quarter of 2018, investment into the U.S. was substantially off from a year earlier. Thus, it appears that Tennessee outperformed most of the rest of the country in attracting business investment from overseas. Most surveys of attractive business climates rate Tennessee near the top of American states. Its success in attracting foreign firms to locate here, and then expand their operations, is certainly confirmation of this.