Polaris to Get $80 Million in Tax and Other Breaks for New Alabama Factory

MINNEAPOLIS (Minneapolis Star Tribune/TNS) -

Polaris Industries Inc. will receive about $80 million in combined state and city subsidies when it builds its new and massive $142 million ATV plant next year in Huntsville, Ala.

Kelly Schrimsher, communications director for the city of Huntsville, said Monday that the Alabama perks and tax breaks include $15 million in land and temporary office space given to Polaris by Huntsville.

It also includes about $31 million in cash and job-training assistance from the state of Alabama, as well as about $34 million in state subsidies tied to Polaris’s agreement to provide 1,700 to 2,000 jobs in the state of Alabama.

Polaris announced the new factory build on Friday. Alabama officials said the company will break ground for the massive ATV factory in Huntsville in February.

The new facility will span 600,000 square feet, and will be Polaris’s second-largest factory, behind its plant in Roseau, Minn. Construction should finish early in the second quarter of 2016. Once complete, the factory will be used to assemble off-road vehicles and build chassis and for body painting, welding, fabrication and injection molding.

Officials with Medina, Minn.-based Polaris, which manufactures all terrain vehicles, motorcycles, snowmobiles and garments, said that they looked at scores of sites before selecting Alabama.

The company will not disclose the exact cost for the new Huntsville facility, said Polaris spokeswoman Marlys Knutson in an email on Monday. However, it is expected to be similar to Polaris’s investment in Monterrey, Mexico, which opened in 2011 at a cost of about $150 million.

At the time the Mexico factory opened, the company was criticized for downsizing its Osceola, Wis., plant. The company, however, rehired some workers in 2012 and spent $1.75 million last year expanding the Osceola factory. The state of Wisconsin contributed $234,000 in tax credits. Polaris added 60 new jobs to the 200 existing jobs there.

Wisconsin, Mexico and now Alabama are the latest in a long line of growth moves for the recreational-vehicle maker.

In 2012, Polaris announced that it would spend $20 million to double the size of its Wyoming, Minn., research-and-development center, adding 144,000 square feet and 300 new jobs.

In recent years, Polaris also added manufacturing space to its motorcycle plant in Spirit Lake, Iowa. In September, it opened its first factory outside North America, a new ATV factory in Opole, Poland, that has 345,000 square feet and 300 workers.

Even with the production ramp-up, the company needed more manufacturing muscle to keep up with swelling demand. Profits and revenue each rose 19 percent for the first nine months of 2014. That’s on top of a respective 20 and 17 percent jump in 2013, when sales reached a record $3.8 billion.