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Oklahoma Department of Commerce

Growing an Aerospace Grove

Grove, Oklahoma has traditionally been known as a tourist attraction and recreational center due to its location directly on the Grand Lake O’ the Cherokees. Accordingly, the city relied on the tourism trade from lake visitors for economic development. But recently, the town is making “new waves” with a somewhat unlikely industry taking center stage — the aerospace industry.

As the aerospace sector has grown to be Oklahoma’s second largest contributor to the state’s economy, trailing only the oil and gas industry, the Grove area is playing a key role in that growth.

Grove, with roughly a population of 2,000 in 1970, has rapidly grown to almost three and a half times that size today. A portion of that growth can be attributed to the influx of aerospace-related businesses in the Grove area. Valence Pride Plating is one of the growing aerospace businesses that calls Grove home. It is one of the leading metal finishing companies in the industry and has been in operation for almost 20 years. The Grove facility currently processes over 50 percent of the major structural parts for the Lockheed Martin F-35 Joint Strike Fighter along with metal finishing for several other large companies including Boeing, Vough Aircraft Industries, Inc., and United Technologies.

Why would an aerospace company locate in a small northeast Oklahoma town like Grove? General Manager Randy Lay attributes one of the primary reasons to the city’s strategic location.

“Based on the proximity to major aerospace hubs in the Dallas-Ft. Worth, St. Louis and Wichita areas, Grove was a centrally located market,” Lay explains.

With approximately 100 employees currently, Lay envisions 50 percent growth over the next 18 months. He also credits Grove and its citizens as other reasons for locating in Grove.

“Grove is a great community with a  fantastic school system and labor pool. Although the population is small, the people of Grove and the surrounding area have a great work ethic,” Lay adds.

Bill Keefer, Grove City Manager, explains how the influx of the aerospace businesses has improved the city and provided numerous opportunities for its citizens.

“The growth of the various aerospace companies have brought a number of new, highly skilled, higher paying jobs to our community. These quality jobs offer opportunities for families to purchase homes and have a higher disposable income that will contribute to the sales tax base for our community,” Keefer explains.

In fact, Keefer indicates the positive aspect of the industry’s growth extends indirectly even beyond the aerospace businesses themselves.

“Local contractors have been used to assist with construction projects. The presence of 400-500 high quality jobs have provided for many positive influences on our local economy,” Keefer said.

Malone’s CNC Machining, Inc. is another aerospace business based in Grove. It manufactures military aircraft parts and assemblies and boasts one of the highest volumes of active government contracts in Oklahoma. As its name implies, Malone’s specialty is in CNC equipment/production as well as assembly work. Founded in 1982 by Donald Malone, the company relocated from California to Grove in 1992 primarily due to its central location.

According to Angie Schulte, human resources manager, one of the biggest challenges facing the company is being able to recruit and hire personnel with the needed technical competencies required to do the job. However, company leadership is tackling that challenge while helping the community, as well.

“Don (Malone) is involved in the Grove High School Robotics program. Through that involvement, the company has been able to hire several individuals. Don believes it starts at the school level and the students need to know programming, engineering and the science of it all.”

With a workforce of 45 full-time employees and 11 temporary employees, Schulte says that sales have increased over 50 percent during the past year. Vince Howie, Aerospace & Defense Director with the Oklahoma Department of Commerce, points out that the aerospace industry is rapidly playing a more prominent role in the Oklahoma economy.

“The aerospace industry in Oklahoma employs about 120,000 people. We just finished an economic analysis and we found out there are some 1,146 different entities that do aerospace business in the state of Oklahoma.

“We have nearly every major aerospace OEM (original equipment manufacturer) in the state with the exception of Airbus. One of the unique aspects about Grove is that the five companies in the Grove industrial park all make parts for the F-35. That is really amazing,” Howie explains.

Howie points out that Orizon Aerostructures in Grove recently underwent a $45 million facility expansion along with plans to install six Ecospeed machines throughout 2017. Ecospeed machines are specially designed for high speed machining of structural aircraft components for aircraft such as the F-35.

Another Grove business, Ferra Engineering, manufactures aerospace parts, including wing components and air frames with some of the aerospace parts for F-35 fighters. Ferra’s website bills itself as “trusted supplier to some of the world largest aeronautical corporations in the world — most notably Boeing, Lockheed Martin, Northrop Grumman and other major OEMs.” Based in Australia, Ferra also manufactures, assembles and tests a comprehensive range of aerospace structures and subsystems. Several key enticements offered by the State of Oklahoma has helped fuel this growth. One of the most attractive incentives is the Aerospace Industry Engineer Workforce Tax Credit.

This credit provides that aerospace companies hiring qualifying engineers can receive a tax credit of 5 percent of the compensation paid to the engineer which is increased to 10 percent if the engineer graduated from an Oklahoma college or university (capped at $12,500 per employee per year), plus another credit of as much as 50 percent of the tuition reimbursed to an employee until Jan. 1, 2026. For the engineer being hired, a tax credit of $5,000 per year until Jan. 1, 2026, is available.

The Quality Jobs Program is another popular incentive available to not only the aerospace industry but also to manufacturers and certain other service industries that have new payroll investment of $2.5 million or more. The program provides a quarterly payment of up to 5 percent of the new taxable payroll.

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