By Randall Turk
The Norman Transcript

It took more than a global brand and a Chinese company's manufacturing skills to create the worldwide headquarters of MG North America in Oklahoma.

Other ingredients are planning and research, financial partners, a strategic location, cheap land, economic development teamwork, a good source of labor and state tax breaks. All that was supplies by:

* Oklahoma Sovereign Development LLC, a Norman-based investment and international development group

*The University of Oklahoma

*The Norman Economic Development Coalition

*The Ardmore Development Authority

*The Oklahoma City Chamber of Commerce

*The Chickasaw Nation

*The Oklahoma Workforce

*State Government incentives.

Planners say what emerges could become a universal manufacturing and distribution model.

Nanjing Automobile Corporation (NAC), China's oldest carmaker, announced Wednesday it will locate an auto assembly plant and parts distribution center in the Ardmore Air Park. An MG research and development center will be created at the University of Oklahoma. MG's worldwide headquarters will be in Oklahoma City. The company expects to employ more than 500, including 325 assembly plant workers, when production gets into full swing.

"The people of Oklahoma have rolled out the carpet for us," said Duke Hale, MG North America's president and CEO.

The company plains to begin assembling the mid-engine, rear wheel drive MG TF Coupe by late 2008. The 2-seater coupe and a roadsters will be rolling off the assembly line when NAC begins operating a Birmingham, England plant that was mothballed by the bankrupt MG/Rover last year.

NAC purchased MG's facilities and tooling equipment for $97 million, disassembled the production plant and shipped everything to Nanjing. The English assembly plant is expected to resume operations in 18 months.

NAC officials said Wednesday the company will manufacture MG sedans in China, along with parts for the other MG models. The plants in Ardmore and Birmingham will assemble and ship the cars from the NAC-fabricated parts and components.

Work to land the MG facilities for Oklahoma began three years ago, said Marc Nuttle, a Norman attorney and economic development consultant who heads Oklahoma Sovereign Development. Nuttle, who chaired Governor Henry's Economic Development Generating Excellence (EDGE) International Markets Committee, has had successful dealings with China and other countries. As a consultant to the Chinese, he helped establish the Shanghai Stock Exchange.

The MG North America deal was an outgrowth of the EDGE initiatives and a subsequent international conference at OU of countries about the same size and with resources similar to Oklahoma's, Nuttle said. Three years ago "Oklahoma didn't have anything" to attract an international manufacturer, he said. "And we had some problems."

Specifically, he said Oklahoma has one-third more counties per capita than any other state, resulting in higher cost of government. And the state has no deep water port, a shipping necessity for most international manufacturers.

Of 10 countries represented at the international conference, Nuttle homed in on Slovakia, which "wasn't even a country until 1994. Slovakia went from being a country to becoming the No. 1 car builder in the world. I looked at their model."

The new order of manufacturing and distribution us the result of tremendous change in priorities and methods, Nuttle said. "Just in time" manufacturing techniques that minimize inventories and the practice of shipping products to their closet point of consumption will bring as much change to manufacturing over the next 20 years as the industrial revolution did over a hundred years ago, he said. "The United States and Europe consume 80 percent of the world's products."

Following the Slovakia model required the use of air cargo to ship high value products such as auto parts and components, Nuttle said, "I did a national search for airports with the potential of significant air cargo operations. Only Ardmore and Portland, Oregon had an abundance of land and no environmental or traffic problems."

A location midway between Oklahoma City and Dallas and within a reasonable distance of the port of Houston were some of Ardmore's other advantages, Nuttle said. "The Ardmore Sir Park can develop 3,000 acres, making it ideal for assembly and worldwide shipping."

Another consultant, Michael R. Davis, was the contact for reaching NAC. Davis Capital Group LLC, a California based financial advisory firm specializing in global transportation industry investments.

Don Wood, executive director of the Norman Economic Development Coalition, knew of NAC's need for a U.S. assembly plant. "Don asked me to make a presentation and arranged for Davis to come to the state," Nuttle said. In February Nuttle was invited to Birmingham, England to discuss the Ardmore plan with NAC officials. "They liked the proposal, Oklahoma and the Ardmore Air Park," he said." I pitched them on a long-term 25-year plan."

NAC's letter of intent to locate North American operations in Oklahoma was signed in late February.

NAC's North American unit will be 51 percent owned by American's- primarily Oklahoma Sovereign Development and Davis Capital. But the deal has other features NAC found attractive. "The Chickasaw Nation has a significant role in this," Nuttle said.

Oklahoma Sovereign Development purchased more than a square mile of land near the Ardmore Air Park, I-35 and the Burlington Northern-Santa Fe Railroad. The Chickasaws have an option to buy some of the land for the 300,000-square-foot MG plant.

Like other tribes in Oklahoma, the Chickasaws could ask the federal government to put the land in trust for their benefit. That would exempt the land from property taxes, resulting in a substantial reduction in MG's operating costs.

The Chickasaws also have pledged to pay for water, sewer and roads serving the MG plant. The Chickasaws, whose holdings include resorts, casinos and several manufacturing companies, "are committed to international trade," Nuttle said. The Chickasaws also seek to export their products to China aboard air cargo planes returning to Nanjing for MG parts, he said.

The deal is further sweetened by state incentives like the Quality Jobs Program, which rewards a 5 percent tax credit to companies creating good paying jobs and the state's Career Tech system that provides technical training for employees. The state legislature also will be asked for $15 million from the newly created "Opportunity Fund," another outgrowth for the EDGE program, which had not been funded until this year. The funds would be used to upgrade the runways at Ardmore Air Park to handle 747 jet cargo planes.

MG estimates its payroll will be more than $30 million when it reaches full production capacity in the Ardmore plant.