Norway’s Kongsberg on Tuesday said it will be building a new factory to build and provide support for Naval Strike Missiles (NSM) and Joint Strike Missiles (JSM) in James City County, Virginia.
The company said its decision to locate the new facility in the U.S. was “heavily influenced” by the possibility the Defense Department May award of a multiyear procurement contract to Kongsberg for these missiles.
The new facility will assemble, upgrade and repair NSMs and JSMs.
The company said these investments will further increase its capacity to build the missiles while doing so in the U.S. near important naval facilities that host ships that field the NSMs.
“The U.S. Navy, Marine Corps and Air Force are important customers for Kongsberg’s Naval Strike Missile and Joint Strike Missile. Their demand signals gave us the predictability we needed to make this investment in the United States,” Eirik Lie, president of Kongsberg Defence and Aerospace, said in a statement.
“This will allow us to better serve our allies in the U.S. and continue to expand that supply chain locally, building capacity and redundancy for these critical capabilities, Lie continued.
This is the second time in as many months that Kongsberg has announced decisions to build new NSM/JSM factories outside Norway, with the first one in Australia after that government agreed to invest $570 million (Defense Daily, Aug. 22)
Kongsberg said the new Virginia facility will amount to a company investment of over $100 million.
“Kongsberg is investing in a big way in the U.S. market by making Virginia the U.S. home of our new missile factory, which will entail hiring more than 180 people. We will also be investing more than $100 million into the Commonwealth of Virginia over the next few years, in terms of property, plant and equipment,” Heather Armentrout, president and general manager, Kongsberg Defense and Aerospace, Inc., the U.S. subsidiary of Kongsberg, said in a statement.
In a statement to Defense Daily, Armentrout said Kongsberg will break ground on this new facility in 2025 and it is planned to be operational by early 2027. While they would not share production rates, she confirmed there will be a surge capacity if customer demand requires it.
While the primary customer will be DoD offices, other customers could be supported, especially via U.S. Foreign Military Sales.
Virginia Gov. (R) Glenn Youngkin said Kongsberg’s investment is divided into $71 million to establish the 150,000-square-foot facility and $30 million in other costs like engineering and software.
Virginia promised to provide over $2 million in grants to win Kongsberg’s selection.
The governor’s office noted Youngkin approved a $1.5 million grant from the Commonwealth’s Opportunity Fund to help James City Country with the project and approved a performance-based grant of $750,000 from the Virginia Investment Performance Grant, which is an incentive to encourage capital investment by existing Virginia companies.
The state will also support job creation for Kongsberg via the Virginia Talent Accelerator Program, a 2019 workforce initiative created by VEDP with the Virginia Community College System, with funding from the governor and the Virginia General Assembly.
The accelerator program helps new facility start-ups via direct delivery of recruitment and training services customized to a company’s products, processes and standards.
The governor’s office noted all program services are provided at no cost to new and expanding companies as an incentive to create more jobs.
Armentrout told Defense Daily the company was also looking into possible locations in North Carolina and Pennsylvania, but chose Virginia for this facility.
“In the end, the proximity to U.S. Navy facilities was a major driver in our selection of Virginia,” Armentrout said.
“The decision to choose James City County, Virginia, was heavily influenced by the continuous availability of well-trained and highly skilled workers coming from the various military installations in the region,” she said in a statement released by Youngkin’s office.
“That combined with the livability of the area and the tremendous support offered by the Virginia Economic Development Partnership [VEDP], the Hampton Roads Alliance and the James City County Economic Development Agency, made it clear that this is where we need to be,” she added.
Hampton Roads Alliance president and CEO Doug Smith noted one third of the region’s local economy supports the defense sector and 18 military installations are located there.
“There is no question Kongsberg Defence & Aerospace chose the right location for its newest U.S. facility in James City County. We look forward to supporting their success in Hampton Roads and Virginia,” Smith said.
This announcement came one day after the company announced a $10 million investment to expand and improve its remote weapon station production facility in Johnstown, Pa., which includes infrastructure improvements, fixtures, tooling and equipment.
Kongsberg said the new additional space will support production on the Marine Corps’ Amphibious Combat Vehicle (ACV-30) gun systems that include a 30mm auto cannon mounted on a Kongsberg remotely operated turret.
The facility currently produces remote weapon stations for the Marine Corps’ Marine Air Defense Integrated System (MADIS) and the Army’s Common Remotely Operated Weapon Station (CROWS) as well as repairing and refreshing other legacy remote weapon stations.
The Johnstown investment is part of a 10 years plus options lease extension in the space that includes plans to hire 20 more employees. The 235,000 square-foot facility opened in 2008 and employs over 220 people. It has built over 20,000 remote weapon stations and about 100 remote turrets
Kjetil Reiten Myhra, executive vice president of Kongsberg Defence & Aerospace’s Defence Systems Division, said the Johnstown facility is the defense business unit’s “largest production facility outside of Norway and that wouldn’t be possible without the ongoing support of the community.”