The City of San Antonio and Bexar County have granted additional tax relief to Navistar International Corp., a trucking manufacturer building a massive plant on the city’s South Side.

The tax abatements are for an expansion to that plant announced earlier this year by Navistar and come on top of other incentives granted to the main site. Together, the company has garnered roughly $14.4 million in tax relief in total.

With the latest incentives approved, the Illinois-based manufacturer has pegged its total planned investment in the area at more than $275 million and expects to create over 650 jobs.  

“Part of our strategy for years has been to focus on advanced manufacturing,” said David Marquez, executive director of the Bexar County Economic Development Department. “These are fantastic career jobs that will be coming here as a result of this Navistar project.”

The company’s vice president for government relations, Jacqueline Gelb, said at a Commissioners Court meeting Tuesday the expansion is “another important step that will enable us to create a competitive advantage in the technology space.”

Navistar, worth $4.4 billion on the stock market, produces commercial trucks, buses, military vehicles, and engines. Its 900,000-square-foot manufacturing plant, which is expected to be completed in December 2021, will produce heavy-duty trucks, including electric trucks.

Navistar’s expansion to that facility is located approximately 8 miles from the main site and will house a testing center to validate components of the company’s electric trucks. It will also include a facility for customizing vehicles for buyers.

Navistar purchased the 148-acre property with existing buildings for $25 million from Halliburton Energy Services.

The incentives on the land are hefty.

City Council last week approved a 10-year, 50% property tax abatement for the site. The incentive is estimated to be worth $297,000 over the period.

Council also nominated the company as a Texas Enterprise Zone, a designation that would make it eligible to receive refunds from the state for sales and use taxes.

Meanwhile, Bexar County’s Commissioners Court on Tuesday passed its own tax relief, granting the company a 100% tax abatement over six years. The incentive is estimated to be worth around $233,000 over the period.

By state law, abatements can only apply to new investments made on the property and do not cover its existing value.

Navistar plans to invest over $28.5 million into the expansion, where it is expected to create at least 60 new jobs paying more than $50,000 within three years, according to documents attached to the county’s agenda item.

The new incentives come on top of incentives granted previously for the company’s main facility under construction.

For the main facility, the County previously granted a 10-year, 100% property tax abatement for new investments on the property, which it estimates at more than $6.9 million, according to Deborah Carter, the county’s director of economic development.

The county also provided a grant of up to $5 million for offsite infrastructure related to roads and a gas line extension.

The City, meanwhile, granted the main facility a 10-year, 100% property tax abatement worth an estimated $7 million.

Business groups in the city have heralded Navistar’s project, as well as its decision earlier this year to expand it, as a marker of the South Side’s newly invigorated manufacturing industry.

“The South Side has and continues to prove to be the ideal location for doing business,” said South San Antonio Chamber of Commerce President and CEO Al Arreola in an email. “Navistar choosing to expand in San Antonio shows we have have the necessary incentives and workforce for their business to continue to grow.”

Councilwoman Rebecca Viagran (D3) said in a statement the South Side has become an “advanced manufacturing hub.”

“This expansion is a true testament that even through the pandemic, our focus has not changed – we will continue to bring job opportunities to San Antonio and continue to see the South Side shine,” she said.

Navistar’s upcoming plant joins other auto manufacturing projects in the area, such as Toyota’s planned $400 million expansion of its Southside plant. Aisin AW, a Japan-based manufacturer producing transmissions for Toyota, is also building a $400 million plant in Cibolo.

Manufacturing is one of San Antonio’s largest industries, with a reported $40.5 billion economic impact from 2016 alone, according to the latest industry-wide report from the San Antonio Manufacturers Association.

Waylon Cunningham

Waylon Cunningham

Waylon Cunningham writes about business and technology. Contact him at waylon@sareport.org.