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September 11, 2007
A new industry is rumbling into town, and will give one of Johnson City’s largest manufacturing sites a new lease on life while adding up to 200 jobs in the high-performance after-market vehicle exhaust business. Oxnard, Calif.-based Borla Performance Industries will buy the 325,000-squarefoot building at the foot of Buffalo Mountain from EPIC (Electronic Product Integration Corp.) Technologies and lease space back to the electronics manufacturer. After Borla completes due diligence on the property, the sale should close by Feb. 1.
Borla co-founders Alex and Alyse Borla visited Monday and met with EPIC employees about potential employment, and Alex Borla said production could begin by early 2008. A public job fair is scheduled for today at the Northeast Tennessee Career Center, 2515 Wesley St.
“We’re going to need people who can bend tubing, and people who can weld light gauge materials, primarily stainless steel, along with accounting, warehousing, facilities and purchasing workers,” Borla said.
Borla produced about 100,000 exhaust systems last year, using about 150 workers at its main site and operating a smaller facility in Michigan. Both will close and all operations will be in Johnson City, bringing 200 or so jobs over the next 18-24 months.
“Our end user is the enthusiast who has a car that he wants to make sound and perform better,” said Borla, who holds four patents from his work with exhaust systems. The company’s “Million Mile Warranty” is based on its high-tech processes and use of high-quality, austenitic steel.
The arrangement also helps EPIC, whose CEO said finding a buyer for its building was a key to EPIC’s viability in Johnson City. EPIC is a contract manufacturer with unpredictable customer demand, Randy Haight said, and leasing the approximately 75,000 square feet it needs provides more flexibility for the company.
“I see this as a triple-win situation,” Haight said. “I think Alex has got a great location and an area to grow his business, we’ve got an opportunity to scale our business, and hopefully the community has an opportunity to protect jobs and provide jobs — I’m very happy that it’s worked out.
“Our primary goal together is to protect as many of the workers as we can in this process.”
Haight did note that there are no job guarantees, and that skills will need to align with Borla’s needs.
Alex Borla said Monday he settled on Johnson City after a lengthy search for a place to expand the company’s operations. While other suitors dangled some tempting offers, the founder of the 30-year-old company said the chosen site (which has been home to Texas Instruments and Siemens Corp. prior to EPIC) best suited his plans.
With its real estate prices, California was not an option, and in fact Borla said many of his employees have left due to the high cost of living.
“We knew we needed to go to a more attractive area where the labor base is available and people can enjoy a nice lifestyle,” Borla said.
He said Carter County Mayor Johnny Holder first hosted him in the area, but that EPIC’s Haight was the difference-maker when it came to final site selection.
“Randy’s the one that put the deal together,” Borla said. “He had the experience and the foresight to come up with some creative components in our relationship that made this possible.”
For his part, Haight said EPIC’s future in Johnson City, where it currently employs 265, remains uncertain. He said some customers have chosen to keep getting product from the Johnson City plant and will remain here indefinitely, but he said market conditions will determine how much space EPIC leases back from Borla, and for how long.
“Today we know that it will extend beyond the transition date of ownership and we have an arrangement where we can be here as long as we need to be,” Haight said.
Borla said customers include individuals, usually wanting to change a stock exhaust system on a new car, as well as car dealerships that offer the products as accessories and options for vehicles made by Ford, General Motors, Chrysler and Toyota among others. “We sell something that everybody wants and nobody needs,” Borla said. “Most people want it because they want to go faster.”
While Borla products are primarily swallowed up by gearheads seeking speed and sound, Borla said they also increase fuel efficiency when the vehicle is driven at conservative speeds. He said UPS puts a Borla system on its trucks.
“We save them $2,500 a year from a $290 investment.”
Borla said his company could conceivably grow beyond 200 jobs.
“We plan to grow into this facility,” he said. “I know it’s a tall order here, but we have grown into every facility we’ve ever had.”
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