South Dakota’s welcoming economic incentives and the worldwide fame of the Sturgis motorcycle rally continue to entice cycle-related businesses to come to the Black Hills, not just for August’s rally, but year-round.
And now, regional economic development officials are revving up efforts to attract more motorcycle businesses and jobs to the region.
The state’s sunny business climate, including the lack of corporate and personal income taxes and deferred property taxes, have put the state in a favorable light for potential motorcycle companies looking to locate in the state, said Ben Snow, president of the Rapid City Economic Development Partnership.
“We talk about the freedom to ride and the freedom to do business the way you want. That resonates with them,” Snow said in a news release from the Rushmore Region Alliance, made up of economic development executives from Belle Fourche, Spearfish, Lead-Deadwood, Sturgis, Wall, Rapid City and Hot Springs.
Many in the cycle industry are already taking advantage of the region's unique position.
“Having the name Sturgis on your address is a big help,” said Kenny Price, owner of Samson Exhaust, which moved from California to the Sturgis Industrial Park in 2013.
“It’s all because of the rally. It lends to the credibility of being in the motorcycle business,” said Price, whose company produces and sells custom and high-performance exhaust systems for motorcycles.
Samson Exhaust, Legend Air Suspension, J & P Cycles, and Competition Distributing are among the motorcycle accessory and component businesses to set up shop in and around Sturgis.
Jerry Greer’s Engineering, a restorer of vintage Indian motorcycles, is located in Deadwood.
Terry Components, specializing in fuel and starting systems for Harley-Davidson and big V-Twin motorcycle engines, and Baggster, a custom motorcycle conversion business, are located in Spearfish.
Also in Spearfish, Polaris opened a paint facility for its Victory and Indian motorcycles earlier this year.
But Price also believes more needs to be done to not only attract new players, but to support existing businesses.
He sings the praises of the state’s low tax-burden environment, but he also decries the dearth of a strong manufacturing base which he said had hindered his ability to do business in the Black Hills.
“What we don’t have here are similar support-type businesses, so we can have things made local. We still have parts made in California and shipped out here,” he said.
He was able to contract to have brackets for his exhaust systems made by Tru-Catch Traps in Belle Fourche, but he would also like to see metal stamping and laser-cutting companies come to the area.
Most of all, Price mentions the need for a local chrome-plating company capable of producing the quality and volume he needs for his custom exhaust systems.
He now ships all of his chrome-plating needs to a company in Wisconsin. The distance makes it difficult to oversee the quality of the work being done, he said.
Sturgis City Manager Daniel Ainslie said gaps in support businesses are being addressed by the city and its business development arm, Sturgis Economic Development Corporation.
Bringing a large-scale chrome plating operation to the area is a priority, he said.
“Anytime you have emerging industries, you need additional supporting industries for that supply line,” Ainslie said.
“So far we don’t a large-scale plater nearby. That’s a hiccup for some of the manufacturers but as demand grows that niche is going to be filled,” he said.
Price’s son, Stan, said the lack of an industrial base also means a lack of manufacturing skills among the employees they hire.
“We have to train everybody,” Stan Price said.
Ainslie said the SEDC is helping to boosting the numbers of skilled industrial workers through a program that exposes high school students to the machinist trade.
Some student machinists have been hired right out of high school, while others have gone on to seek more training at trade schools, he said.
The South Dakota School of Mines & Technology also produces high-level engineers that could be attracted to stay in the area if the right jobs were available.
East of Samson Exhaust on the Whitewood Road in west Sturgis lies Legend Air Suspension, which designs builds suspension systems for motorcycles and utility vehicles.
As with Samson Exhaust and other local motorcycle-related companies, Legend markets and ships its products worldwide.
Legend’s Sheryl Eisenbraun said the company was founded 20 years ago by South Dakota native Jesse Jurrens in his parents’ garage. He built the suspension firm business using engineering support from graduates from the South Dakota School of Mines.
She said Legend employs 22 and ships worldwide through several distributors. The company has benefited from doing business in South Dakota.
“The cost of doing business here is way less than in any other state. You can find a quality workforce at a reasonable rate,” she said.
Earlier this month, Sturgis Economic Development Corporation President Pat Kurtenbach announced two more motorcycle-related companies plan to come to Sturgis in September.
Sturgis MotoCruzin USA will begin production of a line of motorized bicycles and Enviro Shield Products, Inc., will expand a line of spill containment products already used in the oil industry, to other markets, including the motorcycle industry.
Sturgis MotoCruzin USA’s Chuck Jepson and Bruce Lindholm will have a manufacturing and license agreement with Motoped, a Kansas City, Mo.-based company.
They will employ five people to start, with plans to eventually build a 20,000-square-foot production facility.
Enviro Shield Products is relocating from Williston, N.D. Company president and CEO Shane Herman plans to be fully operational in a 7,000-square-foot building in the industrial park.
Two employees will relocate from Williston and another three will be hired locally. Herman expects to eventually employ about a dozen full-time workers.