SPXs Departure Spurs Economic Self Examination

June 5, 2002
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MUSKEGON — A combination of forces drove SPX Corp’s. decision to look for a new home for its corporate headquarters, including the lack of international air service within a close proximity.

After 90 years in Muskegon, SPX plans to decide by Sept. 1 whether to relocate its corporate headquarters to Charlotte, N.C., or Fairfax County, Va.

The July 3 announcement by SPX that it planned to move from Muskegon after 90 years disappointed local economic development officials, despite the negligible direct economic impact resulting from the decision. SPX sold its local manufacturing operations years ago and employs just 50 people at its corporate headquarters, although the company has been a major benefactor to the community for years.

“It signifies the end of an era,” said Cindy Morat Larsen, president of the Muskegon Area Chamber of Commerce.

SPX, a $5 billion multi-industry corporation with 28,000 employees in 34 countries, cited several factors that will drive the final decision on where to move: the total corporate costs of doing business in each community, availability of a labor pool and affordable housing, opportunities for dual-income families, the overall quality of life, and access to metropolitan airports that provide a better domestic and international flight service.

Todd Battle, executive director of Muskegon Area First, the area’s economic development agency, said he understands SPX’s decision, especially the lack of easy access to international air travel.

“Taking three hops to get on an international airplane is no way to do business,” Battle said. “It’s sad to see them go. They’ve been a great company for 90 years and they provided a lot of jobs and a lot of resources and philanthropy to the community. But they’re a drastically different company than when they grew up here.”

Although they understand SPX’s rationale, both Morat Larsen and Battle do disagree with some of the factors in the corporation’s site-selection criteria. Except for an international airport, they believe Muskegon stacks up well with anywhere in the United States on business climate and quality of life issues.

“I think we can put together statistics that will say West Michigan, as a region, is highly competitive with those other areas,” Morat Larsen said.

The announcement of the pending relocation comes just weeks after SPX completed the acquisition of United Dominion Industries Ltd., a Toronto, Ont.-based maker of engineered products for the machinery, flow technology, specialty engineered products and test instrumentation industries. The acquisition doubled the size of SPX and provided an opportune time for the corporation to move.

“Muskegon has been a great home for SPX since 1911,” SPX Chairman, President and Chief Executive Officer John Blystone said in a prepared statement. “The integration with United Dominion provides a natural time to select a corporate location for the next stage in SPX’s evolution.”

SPX just five years ago was a $1 billion corporation and plans to continue a strong growth rate for the foreseeable future, spokeswoman Tina Betlejewski said.

“Certainly we’re going to continue to grow this business,” Betlejewski said. “It makes sense to relocate now before the business grows even further.”

In response to SPX’s announcement, the Michigan Economic Development Corp. said it would “pull out all the stops” to at least keep the company in the state.

Battle, of Muskegon Area First, said the pending relocation reinforces the need for the community to consistently examine its efforts to support and retain businesses.

“We’ve been consistent in our efforts to realize our strengths and build on them, but there’s also weaknesses our community has and we need to work on those,” Battle said.

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