Eaton invests in new South Carolina transformer manufacturing site to power data centers, grid modernization, electrification and industrialization

Rhea-AI Summary

Eaton (NYSE:ETN) announces a $340 million investment to establish its third U.S. manufacturing facility for three-phase transformers in Jonesville, South Carolina. The new facility, expected to begin operations in 2027, will create 700 local jobs and marks Eaton's eleventh facility in the state. This investment is part of Eaton's broader initiative, which has invested over $1 billion in North American manufacturing for electrical solutions since 2023.

The expansion aims to address critical transformer shortages and meet increasing demand from utility, commercial, industrial, and data center customers. The company will convert an existing facility into a state-of-the-art manufacturing site, supported by local, state, and federal economic development incentives. Eaton will continue operating its other three-phase transformer facilities in Wisconsin, while maintaining single-phase transformer production in Texas.

Positive

• Major $340 million investment in new manufacturing facility
• Creation of 700 new jobs
• Expansion addresses critical market shortage in transformers
• Part of larger $1 billion North American manufacturing investment
• Company reported revenues of nearly $25 billion in 2024

Negative

• Production not starting until 2027
• Significant capital expenditure may impact short-term financials

Insights

Financial Analyst

This $340 million investment represents a calculated response to several converging market forces. The transformer market is experiencing unprecedented demand driven by three key factors: data center proliferation, grid modernization initiatives, and industrial electrification. By establishing this third U.S. manufacturing facility, Eaton is positioning itself to capture a larger share of this expanding market.

The strategic timing is particularly noteworthy. With production starting in 2027, Eaton is aligning its capacity expansion with projected peak demand from infrastructure modernization projects and the data center boom. The 700 new jobs and state-of-the-art manufacturing capabilities will provide Eaton with increased operational flexibility and reduced supply chain vulnerabilities.

The investment's location in South Carolina offers multiple advantages: favorable business environment, established workforce development infrastructure through readySC, and proximity to key markets. The government incentives package further enhances the project's economics and demonstrates strong public-private alignment in addressing critical infrastructure needs.

This facility expansion, part of Eaton's $1 billion+ North American manufacturing investment since 2023, positions the company to maintain its market leadership in power management solutions. With 2024 revenues of nearly $25 billion, this strategic investment represents approximately 1.4% of annual revenue, a prudent allocation to address market opportunities and supply constraints.

Industrial Manufacturing Expert

The strategic decision to convert an existing facility rather than build new showcases Eaton's operational efficiency focus. This approach typically reduces project timeline by 12-18 months while optimizing capital deployment. The emphasis on three-phase transformers, which meet the highest efficiency standards in the industry, positions Eaton at the premium end of the market.

The manufacturing strategy includes several key elements:

• Integration with existing Wisconsin facilities creates a robust production network
• State-of-the-art manufacturing capabilities enhance production efficiency
• Collaboration with readySC and regional schools ensures skilled workforce development
• Geographic diversification reduces supply chain risks

The facility's focus on high-efficiency transformers aligns with increasing customer demands for energy-saving solutions. This manufacturing expansion strengthens Eaton's ability to serve critical infrastructure sectors while maintaining quality and reliability standards. The investment in advanced manufacturing capabilities positions Eaton to meet evolving market demands while maintaining competitive advantages in product efficiency and reliability.

• By adding a third U.S. manufacturing facility for three-phase transformers, Eaton supports robust market growth
• Hiring to begin in 2027 for 700 local jobs in the new Eaton Jonesville site, Eaton’s eleventh facility in South Carolina
• Brings Eaton investments in North American manufacturing for its electrical solutions to more than $1 billion since 2023

CLEVELAND--(BUSINESS WIRE)-- Intelligent power management company Eaton (NYSE:ETN) is helping address the critical shortage of transformers and record demand for its solutions across utility, large commercial, industrial and data center customers. The company is investing $340 million to increase U.S. production of its three-phase transformers essential to reliable electrical power. Production and hiring at Eaton’s new Jonesville, South Carolina facility is expected to begin in 2027. Eaton will continue to also manufacture three-phase transformers at two Wisconsin facilities.

Eaton invests $340 million in new South Carolina manufacturing facility for its three-phase transformers, the company’s third in the U.S. Image of transformer manufacturing process from the company’s Wisconsin facility. Image credit: Eaton.

“Electrical power demand is increasing dramatically, and our solutions are at the heart of energy systems everywhere, from the utility grid to industrials, data centers, buildings and more,” said Mike Yelton, president, Americas Region, Electrical Sector at Eaton. “We’re grateful for the strong collaboration and support in South Carolina, where we have a long history of manufacturing and innovation. Eaton is continuing to increase production and add jobs there and across the U.S. to support affordable, reliable and clean energy.”

Eaton transformers meet the highest efficiency standards in the industry, helping customers save energy and costs. Building on more than a century of transformer innovation and manufacturing, Eaton will convert an existing facility in Jonesville, South Carolina into a state-of-the-art manufacturing site for three-phase transformers. The project is supported by local, state and federal economic development incentives. The company is also working closely with readySC and regional schools to support hiring and industry training.

“Eaton’s new operation in Union County, which will mean 700 new jobs for the local community, represents a major vote of confidence in South Carolina’s highly skilled, world-class workforce. This investment is a remarkable milestone for Eaton and Union County, and we celebrate the opportunities it will create throughout the state in the years ahead,” said South Carolina Governor Henry McMaster.

“South Carolina is a leader in manufacturing due to our talented workforce, quality of life and business environment. I welcome Eaton’s investment in Union County, further ensuring our state remains on the forefront of grid modernization,” said Senator Lindsey Graham.

Senator Tim Scott shared, “This is great news! Eaton’s investment and expansion will create more job opportunities for the community and stimulate our local economy. I am glad South Carolina continues to be a hotbed for economic growth and a leading force in energy!”

"South Carolina continues to set the gold standard as a competitive, business-friendly state with a strong and growing workforce. I am thrilled that Eaton has chosen Union County for its expansion, and I look forward to the positive impact this investment will have in the years ahead," said Congressman Ralph Norman.

“We are pleased to welcome Eaton to Union County and acknowledge their investment and the new jobs opportunities they are introducing. Their considerable investment highlights the confidence global companies like Eaton have in Union County’s capability to address their needs. On behalf of the county council, county staff and our partners, we convey our congratulations and appreciation for Eaton’s commitment to Union County,” said Union County Supervisor Phillip Russell.

Eaton will continue to manufacture three-phase transformers in Waukesha, Wisconsin. The company will also continue to produce single-phase, pole-mount and pad-mount transformers in Nacogdoches, Texas.

Since 2023, Eaton has invested more than $1 billion in its North American manufacturing for electrical solutions. Eaton is also increasing supplies of power distribution solutions, including transformers and voltage regulators; as well as electrical assemblies: switchgear, switchboards and circuit breakers; and solutions supporting electric grid infrastructure projects.

Eaton is an intelligent power management company dedicated to protecting the environment and improving the quality of life for people everywhere. We make products for the data center, utility, industrial, commercial, machine building, residential, aerospace and mobility markets. We are guided by our commitment to do business right, to operate sustainably and to help our customers manage power ─ today and well into the future. By capitalizing on the global growth trends of electrification and digitalization, we’re accelerating the planet’s transition to renewable energy sources, helping to solve the world’s most urgent power management challenges, and building a more sustainable society for people today and generations to come.

Founded in 1911, Eaton has continuously evolved to meet the changing and expanding needs of our stakeholders. With revenues of nearly $25 billion in 2024, the company serves customers in more than 160 countries. For more information, visit www.eaton.com. Follow us on LinkedIn.

This news release contains forward-looking statements concerning anticipated production of Eaton’s three-phase transformers. These statements may discuss goals, intentions and expectations as to future trends, plans, events, or state other information, based on current beliefs of management. These statements should be used with caution and are subject to various risks and uncertainties, many of which are outside Eaton’s control. The following factors could cause actual results to differ materially from those in the forward-looking statements: potential global pandemics, supply chain disruptions; unexpected claims, charges, litigation or dispute resolutions; strikes or other labor unrest at Eaton or at our customers or suppliers; new laws, tariffs and governmental regulations; and unanticipated deterioration of economic and financial conditions in the United States and around the world. We do not assume any obligation to update these forward-looking statements.

View source version on businesswire.com: https://www.businesswire.com/news/home/20250212663224/en/

Kristin Somers

+1.919.345.3714

Kristincsomers@eaton.com

Source: Eaton

FAQ

When will Eaton's (ETN) new South Carolina transformer facility begin operations?

Eaton's new Jonesville, South Carolina facility is expected to begin production and hiring in 2027.

How many jobs will Eaton's (ETN) new South Carolina facility create?

The new Eaton facility in Jonesville, South Carolina will create 700 local jobs.

How much is Eaton (ETN) investing in the new South Carolina facility?

Eaton is investing $340 million in the new Jonesville, South Carolina transformer manufacturing facility.

How many transformer manufacturing facilities will Eaton (ETN) have in the US after this expansion?

After this expansion, Eaton will have three U.S. manufacturing facilities for three-phase transformers.

How much has Eaton (ETN) invested in North American manufacturing since 2023?

Eaton has invested more than $1 billion in its North American manufacturing for electrical solutions since 2023.