Blue Origin facility, with 340 jobs and millions in government incentives, contingent on winning ULA contract

HUNTSVILLE, Ala. - Officials from federal, state, and local government joined Blue Origin officials in Huntsville Monday morning to announce a new rocket engine production facility in Cummings Research Park that would bring $200 million in capital investment and 350 jobs, with an average salary of $75,000.

However, the whole deal, including millions of dollars in incentive money, hangs on the United Launch Alliance choosing Blue Origin's BE-4 engine for use with its Vulcan rocket, not a sure thing.

The Company

Blue Origin is owned by Jeff Bezos, perhaps best known for founding and serving as CEO of Amazon. Bezos told reporters previously he'll sell off a billion dollars of Amazon stock every year to fund Blue Origin. The company hopes to provide a space tourism experience. You can see that simulated here:

The Investment

Blue Origin would spend up to $200 million on capital investments for the plant, employing up to 342 people. The average salary for the plant would be $75,000. The facility would take up 400,000 square feet of a 40-acre site on the west side of Cummings Research park, along Explorer Boulevard. It would be geared toward producing the BE-4 Rocket Engine.

BE-4 Rocket Engine

Currently, the BE-4 is slated to power the New Glenn reusable rocket that Blue Origin is developing. However, this entire production facility hinges on the BE-4 being chosen to power ULA's Vulcan rocket. The Vulcan is still in development and is funded through a public-private partnership with the U.S. government.

A spokesperson for ULA was mum on the likelihood the BE-4 is chosen.

"The Blue Origin announcement is wonderful news for Alabama and will continue the strong tradition of aerospace innovation in the state. This is an on-going procurement and downselection and we are not commenting at this time."

The BE-4 is in competition with Aerojet Rocketydyne's AR1. Both engine are American made and would help end reliance on the Russian-built RD-180

The Incentives

Blue Origin will receive millions in incentives if the new facility does come to Huntsville.

Huntsville Mayor Tommy Battle tells WHNT News 19 that Blue Origin will receive in the neighborhood of $6 million in incentives from the City of Huntsville. For one, the land for the site will go to the company for free, at a value between $4-$5 million.

Blue Origin will also receive an incentive package of around $1 million from a joint governmental group, composed of the City of Huntsville and the Madison County Commission. That package will provide aid to construct the facility.

The Alabama Industrial Development Training (AIDT) program will provide training to employees as part of the state incentives, valued by the state at $3 million.  Blue Origin would also be eligible for tax credits with the state that stem from the number of jobs created and the state income tax those jobs generate.

Those credits include, per the Alabama Department of Commerce:

  • Jobs Credit: Estimated value of $8,707,211 over 10 years.
  • Investment Credit: Estimated value of $30 million over 10 years.
  • 20-year Property Tax Abatement: The state approved years 11-20, with an estimated value of $647,745.
  • Reimbursement for eligible capital costs: $10 million

Mayor Battle did make clear though that while incentive packages will be up for approval from the Huntsville City Council and Madison County Commission in the near future, all of those packages are also contingent on the BE-4 being chosen for the ULA Vulcan.

The Timeline

Because the entire project hangs on a contingency, an exact timeline is still not known. As previously stated in the article, ULA would provide no details on a timeline for the selection process of an engine for the Vulcan system.

However, Mayor Battle did tell WHNT News 19 he believes the construction process for the proposed facility would take between a year and eighteen months to complete, after approval was given.