A South Korean firm's plan to build a large PET film plant in Georgia will take away jobs in other states because the market can't accommodate the new capacity, according to an official with DuPont Co. of Wilmington, Del. SKC Ltd. of Seoul said April 8 it will invest $250 million in the first stage of a PET film plant in Covington, Ga., due to come on stream in early 1998.
The plant, about 35 miles east of Atlanta, will have initial film capacity of 110 million pounds per year, growing to three times that size over 10 years, said Chul Chai, senior advisor of SKC America Inc. of Mount Olive, N.J.
Michael Hartnagel, DuPont vice president and general manager of films, said SKC has grown unprofitably in the past five years ``to establish market share and drive out competitors.'' He estimated the U.S. PET film market at about 594 million pounds per year and growing at only 2-3 percent annually. The new plant ``will force U.S. manufacturers to shut down and lose jobs.''
Chai said one of the reasons SKC plans to locate in Georgia is that ``DuPont gave us headaches.'' DuPont and other U.S. producers successfully pushed to impose anti-dumping duties on PET film imported from Korea and Japan since 1991. Chai said SKC's project ``doesn't have much to do with DuPont'' because SKC's product line overlaps little with DuPont's.
``The [U.S.] market is big enough [for SKC's plant],'' Chai said from Mount Olive. ``Whoever makes the best quality and has the best price will be the winner.''
SKC is targeting a wide range of PET film markets, including media tapes, packaging, graphics film and electrical capacitors. The Covington facility will extrude a broad range of gauges but will not metalize or coat film ``because we don't want to compete with our customers.'' It will buy some equipment but will use its own technology for the extrusion and orientation lines.
Chai said the Covington plant also will have a captive PET resin operation big enough to supply the three film lines initially planned. SKC expects to build 1 million square feet of space in the first stage at the 400-acre site. It will begin construction this year.
SKC slates spending a total of $1.5 billion over 10 years at Covington, the largest single industrial project in Georgia's history, according to Gov. Zell Miller.
Georgia will provide a $7.1 million grant to Covington area communities to acquire the land and service it for SKC, according to Jill Goldberg, spokeswoman for Miller's office. She played down DuPont's objections, saying SKC will create 250 direct jobs for Georgians in the first phase as well as construction and spinoff jobs. SKC said it ultimately plans to employ 1,000 at Covington. Goldberg said the new plant is unrelated to SKC's trade practices in the past or ``what they may or may not have done.'' DuPont did not contact the governor's office to object to the project, although the project was rumored for months, she said.
Hartnagel said when a state ``offers incentives for a company to come here and force jobs out, there is something wrong with the system.'' He claimed DuPont is the largest U.S. PET film producer, with plants in Richmond, Va., Florence, S.C., and Circleville, Ohio, but he did not provide a capacity figure. Hoechst Diafoil in Greer, S.C., is next largest, he said. ICI Films' plant in Hopewell, Va., is also a significant producer.
ICI Films officials declined to comment on the project. Hoechst Diafoil officials did not return phone calls.
SKC executives said they chose Covington because of Georgia's Quick Start employee training program, quality of life, ease of transportation and proximity to customers. He met SKC officials in October in Seoul.
The U.S. Commerce Depart-ment began imposing anti-dumping duties in 1991 on PET film imported from SKC and Cheil Synthetics Inc. of South Korea and Teijin Ltd. and Toray Industries Inc. of Japan. The ac-tion came after DuPont, Hoechst Celanese Corp. and ICI Americas Inc. complained about prices.
SKC has about 240 million pounds of annual PET film capacity in Korea, Chai said. It is part of the Sunkyong Group of Korea, a $25 billion company.