There’s the soul-crushing traffic and decades-old battles with Florida and Alabama over water from the ‘Hooch. Don’t forget about the balkanized local governments or that ugly public school cheating scandal.
Arrows fly in the business recruiting wars, and don’t think for a second metro Atlanta’s rivals don’t unload a quiver-full. Yet, somehow, despite its faults, metro Atlanta tends to land its share of corporate relocations and jobs deals.
In November, Atlanta claimed the home of mattress giant Serta Simmons Bedding. In January, Mercedes-Benz picked metro Atlanta for its U.S. hub, ultimately choosing a site in Sandy Springs.
In these moves, metro Atlanta beat rivals in Texas, the Carolinas and Illinois.
The CEOs of metro Atlanta’s newest companies sat down recently to talk about their impressions of the region. For the most part, Serta Simmons Bedding CEO Gary Fazio and Mercedes-Benz USA CEO Stephen Cannon downplayed the blemishes and highlighted strengths — particularly the ones people might expect, such as the airport, business climate and universities.
“Atlanta, a long time ago, was considered: Atlanta, a southern city,” Fazio said in an interview at the company’s corporate center in Buckhead. “Today, it’s Atlanta: a dynamic international city.”
Cannon, the Mercedes USA boss, called the Atlanta a “marquee city for a marquee brand.”
Losing ground
The Atlanta Journal-Constitution recently reported, based on a dozen key indicators such as jobs, wages and population growth, that metro Atlanta hasn’t kept pace with Sun Belt rivals such as Dallas and Charlotte since the recession. By some measures it is being passed by the Big D and the Queen City.
Fazio didn’t dispute the newspaper’s findings, and he said he read various market reports when weighing cities. But every city has its issues, Fazio said. Atlanta’s strengths, he said, such as culture and quality of life, an educated workforce and national and international air service, outweighed weaknesses.
READ THE FULL ATLANTA FORWARD REPORT HERE
Fazio said he’s impressed by local governance and cooperation between Mayor Kasim Reed, a Democrat, and Republican Gov. Nathan Deal to tackle some issues.
Fazio was actually in Charlotte when a story appeared in the AJC that compared the Queen City to Atlanta, finding that Charlotte’s dedication to regional planning, investments in mass transit and other factors had it moving faster these days.
“I like Charlotte, I really do. It’s a nice city,” he said. “But it ain’t no Atlanta. It’s not even a close call.”
Attracting talent
Both men discussed the need to attract the next generation of workers and reaching customers as reasons for moving here.
Incentives were part of the mix — Mercedes received a package valued at about $27 million, the Serta Simmons deal could total more than a few million dollars over several years — but both said broader business interests won out.
The Mercedes U.S. hub is moving from Montvale, N.J., a suburb of New York City, to the Central Perimeter area, a rapidly urbanizing zone near Perimeter Mall. It’s also metro Atlanta’s largest office market.
Cannon, interviewed before the first of the Atlanta Forward series was produced, acknowledged some of metro Atlanta’s known shortcomings, but preferred to take the long view. He also scoffed at traffic gripes.
“We’re coming from the Tri-State area, so our folks have been fighting New York and New Jersey traffic,” Cannon said. “You talk about congestion like you’ve cornered the market on it.”
Cannon said the location should make for an easy commute for employees who might choose the northern suburbs and younger workers who live in the city.
Though Mercedes is a car company, Cannon said many of his workers might prefer to commute on MARTA, which has a rail station a little more than a half-mile from the future headquarters campus at Abernathy and Barfield roads.
Mercedes made the business case for moving South based on cost — lower employee costs (that likely means lower wages for certain jobs), lower taxes and cheaper real estate. The South’s population growth and the growing number of potential future luxury car buyers also played a role.
Cannon also attributed the move to finding the next generation of workers. He said the company liked the quality of young professionals coming out of Georgia Tech, Emory and Georgia State universities. The city’s arts and food scenes were bonuses, too.
Mercedes’ parent Daimler AG has manufacturing facilities in Alabama, South Carolina and Mexico. Vehicles built in Europe roll off a ship in Brunswick. Atlanta made the most sense logistically to reach the factories and for its direct air service to Stuttgart, Cannon said.
Mattress merger
For Serta Simmons, the move to Atlanta accomplishes several goals, Fazio said. It’s partly to establish a new corporate culture for two bedding brands that merged starting in 2010. But it also puts the corporate overseers in a major hub that can reach its dozens of factories, national and international retail customers and help it more easily reach new markets for international expansion.
Serta, the No. 1 brand of beds in the U.S., remains based in Chicago. Simmons, the No. 3 mattress company, has been based in metro Atlanta since the 1970s.
“I’ve lived in Dallas, Houston, Cleveland, Pittsburgh, northern New Jersey, New York City, Washington, D.C., Charlotte, Hilton Head, Asheville,” Fazio said. “I don’t have bias.”
Fazio has homes in North Carolina, South Carolina and now Atlanta. Though the company considered the Chicago area and cities in the Carolinas, which might have been closer to his other homes, he said the search was about positioning the company to serve its brands and customers.
“What city has got a good reputation? What kind of people are you going to be able to hire in that community?” Fazio said. “What’s the transportation — both local and, if you will, the airport. We fly a lot. We have lots of factories all over North America. We have licensees all over the world. We have thoughts about being bigger than we already are.”
Another part of Serta Simmons’ decision in locating in Atlanta is tapping into top engineering talent. The company is working on a plan to re-think the way beds are made and the technology that goes into them, including biometrics.
Fazio said the company already partners with Georgia Tech and top medical schools as part of its design process. In recent years, the company built a new research and development center in Norcross.
ABOUT ATLANTA FORWARD 2015
The AJC is taking a year-long look at the economic state of the Atlanta region. The key question we seek to answer as the region recovers from the recession: Do we have what it takes to attract the companies, jobs and talent to regain pre-recession prosperity?
The initial articles looked at key economic indicators and how metro Atlanta compares to sunbelt rivals such as Dallas-Fort Worth and Charlotte. In many cases metro Atlanta lagged.
This story is intended to provide the perspective of two CEOs whose companies recently decided to put their headquarters in metro Atlanta despite the region's challenges.
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