Korean automaker Kia will build its first North American plant in Georgia instead of Mississippi.
The announcement was not unexpected, but it is still disappointing for an area that was considered at one time the favorite to land the plant.
Kia made its announcement official Sunday night in Korea during a signing ceremony with Georgia Gov. Sonny Purdue.
The plant will be located in Troupe County, Georgia, near the city of West Point. Georgia offered $258 million in incentives to land the plant. State officials there say they believe it will be worth the money.
Construction on the $1.2 billion plant is expected to begin later this year with its opening in 2009.
The plant will employ 2,500 workers. It's also expected to create some 2,000 other jobs at supplier plants in Georgia. Kia officials say they expect to build about 300,000 cars a year at the West Point facility.
Officials in Meridian and Lauderdale County said they are disappointed. Earlier in the process, Kia made the unusual move of saying Meridian was the front-runner for the plant. The company later backed off those statements.
Officials tried to lure Kia to a site near the Mississippi-Alabama border in the Kewanee area.
"I was very disappointed but not surprised," said Meridian Mayor John Robert Smith. "We've heard for several weeks that Kia was drifting in the direction of Georgia."
"My understanding is that this community is close to Columbus, Ga., and Columbus, Ga., has about a thousand Korean residents and I'm sure that's attractive to the Korean company," said Wade Jones, the president of East Mississippi Business Development Corporation.
Both the mayor and Jones said they believe the Kewanee location will be under consideration for any future major economic developments.
A few months ago, Meridian's sole Kia dealership had high hopes of being the most popular car lot in town. Now people there say they are disappointed with how quickly that changed.
They say they don't expect a backlash against their product, but say Kia's backing out of Meridian won't help them either.
"We still have to buy cars from them and we still have a great dependable product," said Paul Johnson. "And we feel like Kia's going places, and maybe they'll expand and we can be on the list later."
Johnson Dodge-Kia officials say right now they sell about seven to 12 Kia vehicles a month.
Kia is one of the fastest growing automakers in the U.S. in terms of sales. When the company began selling cars here in 1994, it only sold 94,000. That number was almost doubled by 2000. In 2005, Kia sold almost 300,000 vehicles.