Revving up on claims about Mercedes' move

Mercedes-Benz USA CEO Steve Cannon and Gov. Nathan Deal look over a Mercedes at the State Capitol following the announcement the car maker is relocating its headquarters to Sandy Springs. BEN GRAY / AJC
Mercedes-Benz USA CEO Steve Cannon and Gov. Nathan Deal look over a Mercedes at the State Capitol following the announcement the car maker is relocating its headquarters to Sandy Springs. BEN GRAY / AJC

Mercedes-Benz made headlines in January when it announced it would built its new U.S. headquarters in Georgia.

The move from the current hub in New Jersey spurred talk about the business climates in each state, and the tax incentives involved in the Peach State’s bid.

The lux German automaker said tax breaks didn’t rate as highly as being close to its manufacturing operations in Alabama and South Carolina.

But in the waning moments of the Legislative session Mercedes got another break from Georgia: an exemption in state and local car taxes for the vehicles its employees lease.

By paying application and license plate fees instead, those workers would save at least $1 million a year.

With the revived discussions – and after midnight vote on the break – PolitiFact Georgia decided to look back to some of the claims about the move earlier this year.

THE JOBS FACTOR

Gov. Nathan Deal touted Mercedes’ relocation as a job machine for metro Atlanta, saying it would create "at least 800 jobs."

Mercedes-Benz USA CEO Steve Cannon has told several media outlets that the firm expects about 40 percent of its workers to relocate to Atlanta. Using the 800 figure, that means 320 people will move and the firm will need to hire for 480 jobs.

So does that translate into "creating" 800 jobs?

Absolutely, said state Economic Development Commissioner Chris Carr.

After all, once the auto company sets up shop here this summer,   there will be at least 800 jobs that today don't exist.

Economists think that’s mostly accurate, with one caveat.

Once Mercedes moves, the U.S. Bureau of Labor statistics will show it as 800 jobs in Georgia. Those jobs will do the things  economists study,  like boost demand for housing and increase tax  collections on the state and local level,  said Bruce Seaman,  an  economics professor at Georgia State University.

That said, it's incorrect to imply the move means 800 jobs for current Georgians.

If you're an unemployed Georgian, you likely have a shot at 480 Mercedes job openings, not 800. But there should still be 800 jobs, once it's all said and done.

We rated Deal’s claim Mostly True.

THE COSTS OF LIVING COMPARED

While Georgia politicians were gushing about the move, New Jersey officials saw the move as a proof that state’s higher cost of the living carried a steep price.

"Mercedes USA made one thing very clear about its decision to leave (New Jersey): the cost of doing business and the tax environment is just too high here to be competitive with a state like Georgia, " Michael Drewniak, spokesman for New Jersey Gov. Chris Christie, told The (Bergen County,  N.J.) Record.

The nonpartisan Tax Foundation rates New Jersey as the state with the worst overall business tax climate. Georgia ranks 36th.

On specific taxes: Georgia's corporate tax rate is 6 percent. New Jersey's 9 percent.

John Boyd, principal of the Boyd Company Inc., a New Jersey-based site selection consultant, predicted the move to Fulton County will reduce Mercedes-Benz's costs, including labor and property taxes, by about 20 percent.

PolitiFact Georgia couldn’t begin to know all the costs that were taken into consideration, given both states staying mum on full incentives and all the costs associated with running a major corporation.

But on what we could compare, Georgia came out ahead on the costs of living. We rated the statement by Mark Drewniak as True.