STS Group AG, a Germany-based vehicle parts manufacturer that two years ago said it would build its North American headquarters in Wythe County, on Thursday announced that it will instead locate in Salem, at the former General Electric building.
The company will invest $32 million and will create 119 jobs, the Roanoke Regional Partnership said in a news release.
The facility will supply parts to Volvo Trucks in Pulaski County as well as other truck and automotive facilities throughout the Midwest and Southeastern U.S. markets, the release said.
STS Group AG is working with Phoenix Group, the owner of the former General Electric building, to upfit roughly 200,000 square feet of existing space and to build a 32,000-square-foot addition on the north end of the building.
The facility will be operated as a subsidiary, STS Group North America.
“We are excited to have the opportunity to work with STS Group and to welcome this company to our diverse automotive manufacturing cluster,” John Hull, executive director of the Roanoke Regional Partnership, said in the announcement. “STS Group effectively adds a new product to the regional supply chain related to automotive and heavy truck manufacturing and further solidifies the regional value proposition for auto-related manufacturing.”
STS Group is headquartered in Hagen, Germany, and has 14 manufacturing facilities in four countries.
The company will receive local assistance with financing, and Gov. Glenn Youngkin approved a $500,000 grant from the Commonwealth’s Opportunity Fund.
In April 2021, STS Group announced it would invest $39 million to construct a new facility in Wythe County’s Progress Park that would employ 120 people. That project never broke ground. According to Thursday’s news release, company officials, faced with “changing market conditions and rising construction costs for a new building,” reevaluated the project, opting to repurpose an existing building instead.
“When STS Group’s business needs changed, Virginia quickly pivoted to an alternate solution to ensure we retained the project in the Commonwealth,” Gov. Glenn Youngkin said in the release. “I am pleased that the former General Electric building in the City of Salem could meet the company’s needs.”
David Manley, executive director of the Wythe County Joint Industrial Development Authority, echoed that sentiment. “Even though the project didn’t continue for a new greenfield facility in Wythe County, we are happy STS Group is still in Southwest Virginia,” he said.
STS Group has begun hiring for the Salem plant. Applicants can visit https://www.adlerpelzer.com/career.