Rolls-Royce Shows How Investing in the U.S. is Good for Business
When Rolls-Royce set out to expand its global footprint, the goal was simple: to better position the company to meet the increasing needs of its business and growing customer base. The British power systems company quickly zeroed in on the U.S., selecting Prince George County just outside Petersburg, Virginia, as the home for Crosspointe — a new state-of-the-art manufacturing, research and development campus. As James M. Guyette, president and CEO, Rolls-Royce North America, observed at the time: “The future of advanced manufacturing is here… and it’s beginning in Virginia.”
In coming to Prince George County, the company understood that it was doing more than just creating jobs: Rolls-Royce was investing in and entering the community and wanted to do so respectfully and thoughtfully. And like other global companies with a footprint in the U.S., Rolls-Royce has found a big return on its investment in the Crosspointe facility, particularly in terms of talent and innovation.
“We’re getting new talent and new thinking in our company,” said Will Powers, executive vice president and CFO, Rolls-Royce North America. “It’s a win-win for each of us.”
The jobs, investments and good will global companies bring are what drives municipalities, states and the federal government to seek more foreign investment.
That effort has become even more important; while the U.S. remains the leader in attracting global companies, it has lost ground over the past decade. The U.S. now accounts for about 17% of global foreign investment, down from 37% a decade ago, according to the Organization for International Investment (OFII).
A number of reasons account for the decline, says Nancy McLernon, president and CEO of OFII. “Other countries stepped up their game to attract foreign investment and may have more robust trade agendas,” she said, while citing U.S. corporate tax policy as another detractor.
Yet McLernon says international firms are still optimistic about investing in the U.S., which remains the strongest market in the world.
Throughout the planning process for Crosspointe, Rolls-Royce worked closely with both state and local government through the Virginia Economic Development Partnership (VEDP) and the Prince George County Board of Supervisors.
“It was a very positive experience,” Powers said. “We were in a pro-business environment with excellent infrastructure.”
Crosspointe was constructed in an undeveloped area where roads and other infrastructure had to be built to access and support the new facilities. In addition to the jobs offered directly by Rolls-Royce at the new site, the development process also supported indirect jobs through the actual construction project and beyond. “Local businesses have benefitted from increased customer traffic — retail, restaurants, hotels,” Powers said. Rolls-Royce plans to create as many as 500 jobs in the future and invest up to $500 million in the area.
Development began in 2008 on the first manufacturing facility, and there will be two more factories built on the Crosspointe grounds. A 90,000-square-foot advanced machining facility, which will produce turbine blades and nozzle guide vanes for commercial aviation engines, will be operational by the end of this year. The third facility will be a joint venture between Rolls-Royce and another party, which has yet to be named, Powers said.
The company also kept sustainability in mind: Crosspointe buildings are Silver LEED-equivalent, featuring automatic light sensing and rainwater and sunlight harvesting to reduce electricity usage while seeking to produce zero waste to landfills.
Ties that innovate
In partnership with area universities, the company recruits leading professors and students from universities like the University of Virginia, Virginia Tech, Virginia State University, and the Virginia Community College System (John Tyler Community College) to assist with research and development projects.
“We have world-class professors in subject matters of interest to us like material sciences and engineering. These professors study in areas of deep interest to us,” said Powers.
The partnership has also created opportunities for students hungry to learn about engineering and manufacturing, while providing a stream of fresh ideas that have helped the company adapt in a fast-changing industry.
Aside from college internships, the company started a small apprentice program last year for local high school students. The program’s four students spend time outside of the classroom, earning college credits and gaining real-world skills at the Crosspointe facility.
“We’ve got some really good students who came and joined us. We’ve deemed it as a success, and the prospects look good,” Powers said.
Collaborating on Research
Rolls-Royce works closely with the Commonwealth Center for Advanced Manufacturing (CCAM), an applied research center led by the University of Virginia and Virginia Tech, the state's two leading research-based universities, that links university research to product development at major companies.
Made up of a dozen-plus members — ranging from Old Dominion University to NASA, Canon and Siemens — CCAM is the only consortium of its kind in North America. Located adjacent to the Rolls-Royce facility, it allows its participants to pool research to create cost-effective, leading manufacturing solutions.
“Instead of everyone spending money on generic technology, we pool our money, and we jointly own the research,” Powers said. “The beauty is everyone brings something different to the table, but what we have in common is we want to make our materials last longer.”