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07-30-2007, 02:15 PM
MG auto plant taking bumpy road to Ardmore

July 30, 2007

OKLAHOMA CITY – Oklahoma’s deal with Nanjing Automobile Corp. to locate an MG automobile plant in Ardmore hasn’t exactly turned out to be a slam dunk.Officials say negotiations are ongoing, but acknowledge some hiccups that are bound to cause economic development heartburn.Two of the latest wrinkles are licensing and trademark issues intertwined with the merger of Nanjing with Shanghai Automotive Industry Corp. Discussions between the two Chinese auto companies have been under way for months. The two reportedly signed a letter of intent this week to form a partnership.

Paul Sund, spokesman for Gov. Brad Henry, said the governor’s office has been aware of the trademark issues for some time.“We always knew this was a very complex deal that would require a lot of work, but Governor Henry remains optimistic it will ultimately come to fruition,” said Sund.Wes Stucky, president of the Ardmore Development Authority, said “There are some licensing issues with Nanjing and also with Shanghai Motors.”However, Stucky echoed the governor in saying that negotiations continue.“There are issues to be worked out,” he said.Marc Nuttle, an Oklahoma attorney heading up negotiations, was out of the country Friday.An e-mail to Nanjing Automobile Corp. for comment went unanswered.

The state provided $15 million from its new Opportunity Fund for improvements, including extension of a runway at the Ardmore airport, as well as a $5 million startup funding loan for the MG project that has already been paid back.The Oklahoma Supreme Court recently struck down the process for approving awards from the fund, which involved a board composed of the governor and House and Senate leaders. However, the decision’s effect is prospective, and did not nullify the $20 million package for Ardmore.Another $2.5 million has been secured from the Federal Aviation Administration for runway improvement, plus $10.5 million in Ardmore tax-increment district funds, $3.5 million from the city of Ardmore and $1 million in authority funds for water and wastewater extensions, streets and roads, rail spur extensions and aircraft hangar improvements.

Stucky said the development authority recently selected TTK Construction of Edmond for the runway-expansion project.When the MG project was announced a year ago, officials estimated that the plant could create 575 direct jobs, with indirect and temporary jobs bringing the total to more than 1,300, as well as a boost of $189 million in economic activity.If the authority fails to complete the runway extension within three years and fails to complete improvements aimed at making Ardmore an air cargo transportation hub within five years, the $15 million must be paid back with 6-percent interest.

The state may extend these deadlines for up to two years upon good cause shown by the development authority.The state will have a lien on the improvements funded by the $15 million.In the event that the MG deal ultimately falls though, Stucky said the lengthened runway and other improvements could lure other businesses and industries to the state.“We’re having ongoing discussions with numerous companies,” he said.

10-10-2007, 09:18 AM
MG plans downshift

By Paul Monies
The Oklahoman

A government-mandated consolidation of the Chinese auto industry has put on hold a project to build MG sports cars in Oklahoma, one of the dealmakers said Tuesday.

But Norman attorney Marc Nuttle, who formed Oklahoma Global Motors LLC with China's Nanjing Automobile Group Corp., said he still hopes the project will get a green light from the Chinese government by the end of the year. Nanjing is merging with larger rival Shanghai Automotive Industry Corp.

"Right now, they're in restructuring mode, and I don't know what they're going to do,” Nuttle said. "They merged with Shanghai, and there's nothing we can do about it. It's not Oklahoma's or the Chickasaw's fault; that's the state of international business.”

The MG auto plant was to be north of Ardmore on tribal land owned by the Chickasaw Nation and next to the Ardmore Airpark. The project was expected to create up to 500 jobs, including several in Norman and Oklahoma City.

Nuttle stopped short of calling the MG deal dead.

"They still contact me on a regular basis to let me know they're still interested,” Nuttle said of his Chinese partners. "There's nothing I can do to help them until they restructure the company.”

Nuttle said an upcoming Chinese Communist Party conference — which opens next week — may provide some clues to the direction of the restructuring effort in the Chinese automobile industry. There are more than 127 Chinese auto manufacturers, but the Chinese government wants just eight, Nuttle said.

He said other possibilities for Ardmore wouldn't be dismissed while the MG project is on "indefinite hold.”

"We're talking to other companies, and there are companies that would like to come here, but the MG brand was a key component to the business plan,” Nuttle said.

Nuttle made his remarks at Global Fusion Oklahoma, an international business conference being held this week in Oklahoma City.

Airport expansion
In the meantime, plans are progressing for the $35 million International Trade Center project at the Ardmore airport, he said. The air cargo hub would serve more than 12 million people within a 350-mile radius of Ardmore.
Nuttle said as coastal ports get increasingly congested and unable to expand, the next wave of logistics will be the development of inland ports that connect air, rail and roads.

"We are trying to develop one of the top air cargo just-in-time manufacturing/assembly/distribution warehousing centers in the United States in Ardmore, Oklahoma,” Nuttle said. "It's an old military base that the state and city of Ardmore put millions of dollars into to bring it up to scale as a ‘Class A' world cargo airport.”

Wes Stucky, president of the Ardmore Development Authority, said TTK Construction Co. has been awarded the $14,085,000 bid to build a runway extension at the Ardmore Airpark to accommodate freight planes.

That money came from a $15 million grant from the state's Opportunity Fund, an incentive program passed in 2006 to close economic development deals. Nuttle's Oklahoma Global Motors received a $5 million, short-term loan from the Opportunity Fund for start-up costs on the MG project. The company repaid that earlier this year along with $102,779 in interest.

Stucky said other improvements are being made at the airport for water lines and roads. Construction is expected to start by early 2008, he said.

Nuttle said Ardmore officials also have held preliminary discussions with railway operator BNSF Railway Co. to connect the airport with the railroad's expansion plans in Dallas.

"We'd be part of the Chicago-Dallas route for loading and storage,” Nuttle said. "What we're trying to do is coordinate in a national distribution system and find our place. BNSF is being as cooperative as they can, but they've made no commitments.”