German manufacturer Tognum is setting up a new engine assembly and manufacturing plant for Tognum's MTU brand in South Carolina's Aiken County.
It will replace the existing assembly plant in Detroit. Production is scheduled to begin at the end of this year.
In addition to the assembly of engines, the plant will be used for the manufacture of engine components such as cylinder heads and high-volume engine attachments and fittings. The premises also include the possibility of increasing production capacity if warranted by market requirements and the order situation.
Tognum manufactures engines for many industries, including marine.
"For a global group like Tognum, a global production network is absolutely essential, and the plant in Aiken has an important role to play," said Volker Heuer, chairman and CEO of Tognum AG, in a statement.
"By manufacturing parts in the U.S.A., we are less vulnerable to exchange-rate fluctuations between the U.S. dollar and the euro, have production facilities located close to the customer, fewer parts in an advanced stage of manufacture to be transported from Europe to North America and will subsequently reduce high import duties," he added.
The Tognum Group will be investing about $45 million dollars in the 100-acre site, which includes a 270,000-square-foot production building and assembly, inspection and production facilities.
The State of South Carolina, Aiken County and state authorities are supporting the development of the new location with subsidies, tax relief and the donation of an additional site, the company said.