Signature Associates

Peloton to build first U.S. factory in Wood County

Peloton Interactive Inc., which makes a popular line of high-end exercise equipment including stationary bicycles, has chosen Wood County’s Troy Township as the location for its first U.S. factory, a one-million-square-foot manufacturing plant that will cost $400 million and employ nearly 2,200 workers.

Construction of the state-of-the-art Peloton plant is expected to begin this summer with completion by 2023. The Rudolph/Libbe Group was chosen as the general contractor.

The plant will be located on a 200-acre site in Luckey, just south of the junction of U.S. 20 and I-280, and to the north of the existing Home Depot Distribution Center and new NSG Group glass plant that opened in November.

The decision by New York-based Peloton to locate in Wood County was announced Monday morning in Columbus at a meeting of the Ohio Tax Credit Authority. Gov. Mike DeWine signed an incentive package provided by the state that will make the project possible.

“The pandemic has demonstrated the need to on-shore manufacturing and rebuild supply chains, and Peloton’s decision to build its first North American manufacturing facility in Ohio is a great example of an American company stepping up and leading that effort,” Mr. DeWine said. “Ohio is excited to partner with Peloton’s forward-looking leadership team in developing a new, state-of-the-art facility using connective technology, and creating 2,174 new manufacturing jobs in Wood County.”

The package includes a 2.301 percent, 15-year Job Creation Tax Credit. Peloton has promised to provide $138 million in new annual payroll. It also has committed to spend $400 million on the new facility, which it will call Peloton Output Park.

The facility will contain manufacturing, office, and amenities space, making it one of the largest connected fitness manufacturing plants in the world, Peloton said. The company added that it plans to incorporate renewable energy sources to power its operations.

In an unusual move, the company said Peloton Output Park also will be open to the Troy Township and larger Midwest community. It plans to host facility tours and open an on-site showroom. Customers will have the option to check-out Peloton products first-hand at Troy Township.

The Governor’s office, JobsOhio, the Ohio Development Services Agency, the Regional Growth Partnership, the Wood County Economic Development Commission, Troy Township officials, and others were all part of the team that helped convince Peloton to choose Ohio after a multi-state search for its new plant.

The company, which was founded in 2012 and is now worth $1.8 billion, has popularized fitness with its stationary bikes and treadmills that include a touchscreen on which users can stream virtual classes for a monthly fee of $12.99.

But Peloton has struggled to meet demand, having its products made in Asia but assembled in the United States.

To cut delay time, the company doubled its manufacturing capacity last year by opening a new plant in Taiwan and purchasing rival Precor last December for $420 million to acquire Precor’s manufacturing plants in North Carolina and Washington.

The Troy Township plant will produce the Peloton Bike, Bike+, and Peloton Tread starting in 2023.

“We are thrilled to bring a good portion of our manufacturing to United States soil and proud that it will be in the great state of Ohio,” Peloton CEO and co-founder John Foley said. “While we will continue to invest in our Asian manufacturing footprint as well as our existing facilities in the U.S. via our Precor sites, the new Peloton Output Park gives us a massive strategic lever to make sure we have capacity, quality, and economies of scale in our bike and tread product lines, to support our continued growth for years and years to come. We are incredibly excited to meet and welcome the Troy Township community into the Peloton family fold.”

Wade Gottschalk, executive director of the Wood County Economic Development Commission, said the substantial size of the Peloton facility pretty much will fill up the remaining available land at the Troy Township site but that is a nice problem to have.

“It’s a great win for northwest Ohio and Wood County. It’s going to be a great project,” Mr. Gottschalk said. “… We were really excited to work on this.”

Mr. Gottschalk said he was notified in mid-February that an unnamed company was looking at Troy Township.

“They came to us with this site in mind. They were looking at other sites in the region as well, but they were very interested in this site,” he said.

With access to highways, waterways, train and air travel, Wood County has been able to attract a diversity of industries, Mr. Gottschalk said.

“Our location in the greater scheme of North America is really unique. Site consultants have noticed the economic development opportunities and labeled it one of the better locations,” he said. “It’s really hard to beat and it’s not something you can recreate. You can’t just go out and do it. I-75 and I-80 aren’t moving.”

Mr. Gottschalk said Peloton also was impressed by northwest Ohio’s labor market.

“We have an amazing labor force here. Yes, the labor market right now is tight, but the labor force is really second to none,” he said. “Thanks to our history of manufacturing and the auto industry, our workers have developed the skills that’s really allowed us to compete.”

Posted By: Crain’s Detroit Business on May 25, 2021.  For more information, please click here to read the source article.

To receive the In The Know from Signature Associates, please click here to be added to our mailing list.