CNH Industrial Invests $24M to Expand Iowa Production - Analyst Blog


CNH Industrial N.V. ( CNHI ), a premier global manufacturer in the capital goods sector, is making a $24-million investment to expand its production facilities in Burlington, Iowa. With the capital funds, the company intends to add a crawler dozer production line to its manufacturing plant in the city.

The expansion will create approximately 50 full-time jobs, with production in the crawler dozer line expected to commence in the second half of 2015. The project is subject to approval and completion of all state and local incentives and grants.

Under the modified operating plan, the production facilities will consist of a new paint line, a dedicated assembly line, and welding and computer numerical control machining equipment. The state-of-the-art production line will complete the dozer products range for Case Construction Equipment, catering to the construction requirements of the region. Case Construction is one of the flagship brands of the company for earth-moving equipment.

Currently, the equipment is being manufactured at the Calhoun, GA-based plant which will close in the third quarter of 2015 as part of the company's strategic operational adjustments.

Shifting the production line to Iowa corresponds with the company's long-term strategy of optimizing its manufacturing foothold and accomplishing a streamlined, flexible industrial operational structure. Moreover, the move is aimed to capitalize on the burgeoning demand for high-quality construction equipment in Iowa.

The Burlington plant, employing over 600 people, has been manufacturing equipment for CNH Industrial's brands since 1937. Apart from producing Case Construction Equipment, the plant also manufactures agricultural equipment for Case IH and New Holland brands.

CNH Industrial has a strong market presence with 12 manufacturing plants, 12 research and development centers, and a combined workforce of 10,000 people in North America. The company is currently seeking to expand its footprint in high-growth regions to extend its leading position in the market.

CNH Industrial presently holds a Zacks Rank #3 (Hold). Notable stocks in the foreign auto industry that look promising include Nissan Motor Co. Ltd. ( NSANY ), Fuji Heavy Industries Ltd. ( FUJHY ) and Toyota Motor Corp. ( TM ). While Nissan sports a Zacks Rank #1 (Strong Buy), both Fuji and Toyota carry a Zacks Rank #2 (Buy).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.

This article appears in: Investing , Business , Stocks

Referenced Stocks: CNHI , TM , NSANY , FUJHY

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