Indiana has a long relationship with aviation-related companies, from Rolls-Royce Indianapolis and GE Aviation to now, Saab, which will build the fuselage for the new Boeing/Saab T-X jet trainer for the U.S. Air Force at the Purdue University-affiliated Discovery Park District Aerospace complex in West Lafayette.

In May, Indiana Governor Eric J. Holcomb, Purdue University President Mitch Daniels, and Saab President and CEO Håkan Buskhe announced plans to build the manufacturing center, which will create 300 new jobs initially.

“This is a historic moment for Saab,” said Buskhe. “After careful consideration, we have chosen West Lafayette, thanks to the visionary leadership of both the state of Indiana and the world-leading Purdue University.”

West Lafayette was one of four sites chosen after a rigorous selection process by Stockholm-based Saab.

Construction will begin in 2020. Once the production center is fully operational, the completed fuselages will go to Boeing’s facility in St. Louis, Missouri, for final assembly.

Saab will invest $37 million in the new manufacturing facility, while Indiana will provide Saab with support through its Economic Government Growing Economy (EDGE) performance-based tax credit program. The Indiana Economic Development Corp. (IEDC) will offer Saab up to $3.98 million in conditional EDGE tax credits and up to $1.5 million in training grants over two phases based on the company’s job creation plans. Saab is not eligible to receive incentives until jobs are created and qualified capital investment is made, according to Indiana Secretary of Commerce Jim Schellinger.

The IEDC also will offer Saab up to $200,000 in conditional tax credits from the Hoosier Business Investment (HBI) tax credit program, which is based on Saab’s planned capital investment in the state.

Purdue Research Foundation, the city of West Lafayette, the city of Lafayette and Tippecanoe County also offered additional incentives.

Indiana’s attractive low tax base acted as a calling card for Saab, said Schellinger. The state’s corporate income tax rate is decreasing from its current 5.75% rate by 0.25% each year until 2020 when it reaches 5.25%. In 2021, the rate will be set at 4.9%.

Individual income tax rate is now 3.23%. Inventory and inheritance tax rates were eliminated in 2007 and 2013, respectively.

There was another reason why Saab chose West Lafayette.

 “The research and development wing of Saab melded well with Purdue University,” said Schellinger. “This was a perfect fit for Saab.”

Saab also might have turned to the Hoosier state for its bi-partisan spirit. Businesses “want to work in areas where governments get along with one another,” said Schellinger, recalling a story about why a segment of GE chose Indiana. “They don’t want to deal with partisan politics where parties will be fighting left and right all day long.”

Take the example of the two Lafayettes: West Lafayette Mayor John R. Dennis is a Republican. Lafayette Mayor Tony Roswarski is a Democrat. Both have pledged support to bring in new business and enhance those businesses in place.

Having a bipartisan approach also helps streamline government approvals for business projects, said Schellinger.

The U.S. Air Force plans to purchase 351 T-X trainers in the first phase. Other services also have expressed interest in the trainer.