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Jun 16, 2014

Proximity Manufacturing and Logistics

As free trade continues expanding in the global marketplace, more and more companies are looking at proximity manufacturing and logistics to optimize their international operations. 

For the last few decades the trend for foreign companies looking to increase sales and profitability in the United States has been to strategically place satellite manufacturing facilities in U.S. markets to take advantage of supply chain networks, resources and raw materials, not to mention a workforce that can influence brand and customer loyalty for foreign-owned company products made in the United States.

It’s no coincidence that Toyota and Honda have been building some of the top-selling automotive brands in the U.S., and that they’re also offering some of the most American-made cars sold in the United States. The fact that U.S. workers are building these products is definitely a factor for inspiring such a high level of American consumer confidence in these Japanese brands. It’s also no accident that when Toyota had the option of choosing anywhere in the United States to consolidate global Highlander production, Toyota chose Indiana.


As centralized manufacturing and distribution continues to trend upward in the U.S., companies both at home and abroad are cognizant of the fact that it’s simply not enough to offer products that Americans want. More and more, those products are being made here, not just to optimize logistic efficiency and cost savings for U.S. markets, but to inspire long-term consumer loyalty.

In Indiana, we see brand loyalty increasing on both sides of the ocean, and the fact that we’re now producing Highlanders for the global market speaks to the level of manufacturing expertise we’ve achieved in the Hoosier State. It’s at least part of the reason Japan has been our sister state for the last 15 years (since 1999). Japan represents a significant business and ambassador relationship that continues to pay back phenomenal dividends in new jobs and capital investment in the Hoosier State. Likewise, Indiana is a major manufacturing hub, contributing to considerable U.S. sales for Japanese companies. It took an incredible investment in time and resources for Indiana to earn the trust and respect of Japan, and it took decades to develop the level of confidence for Indiana to be seen as one of the top U.S. business destinations of choice for Japanese companies.

That level of trust and commitment is creating new opportunities in Indiana. It's no wonder that we’re also the only U.S. state to have Toyota, Honda and Subaru automotive assembly plants inside our borders. Indiana is also the only U.S. manufacturing location for Subaru’s North American automotive production. The bottom line is that Japanese companies are viewing Indiana as a known commodity and a safe and profitable location to grow their U.S. operations. It’s not just Japan either. Over 35 countries have a presence in Indiana in every corner of the state. In fact, the most recent data from the Indiana Business Research Center shows that, between 2012 and 2014, Indiana had foreign direct investment announcements valued at nearly $5 billion.

The list of international companies leveraging Indiana’s resources and low business costs to make the most out of their U.S. operations is impressive. After a 100-year presence in the United States, Indiana is the largest manufacturing site for Rolls-Royce civil aero engines outside the United Kingdom. Italian motorsports innovator, Dallara, recently opened the first location in the United States for their futuristic race simulator in Indiana, and as a result we’re the first state in the nation to offer a university degree in motorsports engineering.

We’ve gained this level of trust and commitment with international companies because we’re more than just good ambassadors. We have the resources and the will to create long-term solutions for international business, and we’re deliberately building a precision economy that is balanced, efficient, and powerful. 

We’re bringing together the vision and the know-how to combine one of the world’s most productive steel regions with our geographic positioning near the logistical center of the United States. We’re using that combination to deliver the innovations of the 21st century to a new global marketplace.

How are we providing stability when so much of the global economy is shrouded in uncertainty? It’s simple. We’ve spent years balancing our budget, eliminating excess and red tape, and today we’re one of only a handful of U.S. states with a AAA credit rating and an actual budget surplus. We’re investing in the infrastructure to keep us moving forward and we're maintaining our economic stability to keep business costs low, for a strong and stable economic future.

We’re lowering business taxes this year, next year, and every year after that through 2021. We’re one of the top states for regulatory freedom, and we’re defining a new standard of opportunity for businesses to reach their full potential. But it’s more than just our rankings and our balance sheet.  Today we’re in a better position than ever for attracting more international companies and investors to Indiana, and there has never been a better time to leverage our accomplishments and continue telling our success story to the rest of the world. It’s a story about Indiana’s unique brand of fiscal stability, low business costs and business-friendly policy that has earned us the trust and commitment overseas for growing international companies in Indiana.

It all starts with leveraging our resources, our world-class infrastructure and Heartland location to provide one of the most efficient and cost-effective solutions for delivering the goods, not just to U.S. destinations, but to the rest of the world. By providing better connections at a lower cost, and by working together to strengthen our entire region, Indiana is unapologetically bold about our emergence as a regional epicenter for business and opportunity. We’ve earned our pro-business and low-tax reputation and proven that we can compete and win new business in the global marketplace.

We’re building economic strength and momentum, and it’s propelling us on a trajectory toward growth and prosperity. We’re serious about bringing together the people, the resources and the freedom for international companies to succeed on their own terms, and we’re doing it right here, in A State that Works.