A venture formed by seven of the world’s largest automakers plans to set up its global headquarters in North Carolina after receiving more than $3 million in taxpayer subsidies as potential compensation.
IONNA says it was formed with the goal of “redefining, leading, innovating, creating and driving charging as an end-to-end integrated customer experience” in the electric vehicle industry. BMW, General Motors, Honda, Hyundai, Mercedes-Benz, Kia and Stellantis formed the coalition with the idea of ”reimagining electric vehicle charging.”
The company’s launch also includes plans to design, develop, build and operate a high-power electric vehicle charging network that will be “key to expanding EV adoption in North America.”
According to the company’s announcement, the facility will house “a customer experience lab that will act as the control center and central node for seven new satellite labs that will be set up in each of the founding member facilities.”
North Carolina’s embrace of the startup company was also made possible by a Job Development Investment Grant approved by the Economic Investment Committee on Tuesday.
The 12-year grant will allow for reimbursement of $3,075,000 over 12 years.
The state and IONNA say the grant will grow the state’s economy by $724 million over its lifespan, create 203 new jobs and recoup 108 percent of public funds.
That works out to a cost of $2.08 per dollar to the state.
The Department of Commerce said IONNA’s average annual wage will be $128,457, and lists Durham County’s average as $90,727.
The department justifies incentives based on the new jobs companies bring to the state, publishing the average hourly wage of the new jobs and comparing it to the county average hourly wage.
Economists have questioned the effectiveness of financial incentives to get private companies to expand or relocate to new states.
They also question the use of hourly wages as a proxy because the salaries of a few company executives could skew average wages higher while not having the same impact on median wages.
“This region has an established history of research and innovation and a vibrant, growing community, making it the perfect place for IONNA to join, grow and pioneer,” CEO Seth Cutler said in a company release. “We’re excited to foster a cross-industry team that will bring IONNA’s vision to life from our new home.”
“These advanced manufacturers coming to North Carolina affirm the importance of our ‘First in Talent’ plan, which prioritizes developing a diverse, well-trained workforce to help businesses blaze new trails,” Commerce Secretary Machelle Baker Sanders said in a state release.
The announcement is one of several made in North Carolina’s auto industry this year and since the end of COVID-19.
The state ranked first in CNBC network’s “America’s Best States for Business” rankings for the second year in a row.
When Gov. Roy Cooper made the announcement last July, he offered criticism while also crediting the Republican-majority Legislature with enacting laws that have made the state a friendly place for businesses to expand and explore for new bases.
The governor has long called public education “an emergency here” amid an influx of businesses and population and growing waiting lists for school choice enrollment.
This equation produces talent levels in the workforce, and the governor acknowledged that in his reaction to the decision.
“This cutting-edge company and its founding automaker will benefit from North Carolina’s innovative ecosystem, highly skilled workforce and central location to bring pioneering technologies to market,” Cooper said Tuesday.
A January analysis by the Department of Consumer Affairs showed Honda in third place in global market share, Hyundai in fourth, Kia in fifth, BMW in seventh and Mercedes in eighth.
