Japanese air conditioning and heating systems maker Daikin Industries Ltd. is expanding the footprint of its American subsidiary Daikin Applied Americas Inc. with a $40.3 million project in Faribault. Approximately 132 jobs are expected to be created.
The Plymouth-based subsidiary, which manufactures heating, ventilation and air condition systems, said it will purchase an existing 300,000-square-foot warehouse in Faribault and renovate it into a state-of-the-art production facility.
To help finance the expansion, the Minnesota Department of Employment and Economic Development (DEED) will contribute a $750,000 loan from the Minnesota Investment Fund, and a $1.6 million grant from the Job Creation Fund.
“Daikin Applied explored multiple U.S. sites and Mexico for this project but ultimately chose southern Minnesota,” noted DEED commissioner Shawntera Hardy in a statement. “The company’s decision to expand in the area is a testament to the region's skilled workforce and positive achievements at existing operations.”
Through the Job Creation Fund, DEED has awarded $41.4 million to 91 business expansion projects throughout the state, since the pay-for-performance program’s inception in January 2014. The supported projects have generated 5,558 full-time jobs, DEED claims.
Meanwhile, for its part, the Minnesota Investment Fund, which awards loans to businesses for improving operations and hiring additional workers, has helped generate 1,175 jobs to date, according to DEED.
The 132 jobs Daikin Applied will add brings its Minnesota workforce up to more than 1,000 people, as it currently employs 900 people across existing manufacturing facilities in Faribault and Owatonna.
The workforce of Daikin Applied’s parent company, the Osaka, Japan-based Daikin Industries Ltd. is even larger, with more than 70,000 employees throughout its 90 production sites worldwide. Daikin Industries, in fact, is the world’s largest HVAC manufacturer, with customers in more than 150 countries and annual revenue of more than $20 billion.
The positive impact on the Minnesota job market that Daikin Applied’s Faribault expansion will have comes amid a record state unemployment rate, as it fell to an 18-year low of 3 percent in July. Manufacturing was among the industries with job gains, adding 1,500 positions industry-wide. Numbers for August have not yet been released.