Tom Eblen

Year in Kentucky business saw Toyota expand, bourbon boom, coal decline

The first U.S.-assembled Lexus (ES 350) vehicle was unveiled in a ceremony in Georgetown, Ky. on Oct. 19.
The first U.S.-assembled Lexus (ES 350) vehicle was unveiled in a ceremony in Georgetown, Ky. on Oct. 19.

This was an eventful year for Kentucky businesses: Toyota accelerated, bourbon distillers rolled out more barrels, Tempur Sealy employees lost some sleep, King Coal coughed and wheezed, and so much more.

As Toyota marked its third year as the world’s top-selling automaker, the Georgetown assembly plant that since 1988 has been churning out Camrys, Avalons and Venzas opened a new production line in October to make the Lexus ES 350.

Toyota invested $360 million and hired another 750 people to build 50,000 of the Lexus sedans each year, marking the first time the luxury model has been made in America. The launch followed August’s groundbreaking for an $80 million Toyota engineering campus in Georgetown that will open in two years.

Other good news came from the bourbon whiskey industry, which continued riding a wave of global popularity. Kentucky bourbon production is up 170 percent since 1999, and distillers now have more than 5.7 million barrels aging, the most in four decades.

The bourbon boom prompted new owners to begin restoring the castle-like Old Taylor distillery near Frankfort, which will have Kentucky’s first female master distiller. Alltech, which expanded its beer-brewing capacity in Lexington this year, broke ground in July for a distillery in Pikeville.

The food business was good, too: Kroger opened its new urban-style Euclid Avenue store in January, with parking on the roof. But many customers were upset by the subsequent closing of the little Romany Road store eight months later. The state’s biggest Kroger store opened in Versailles in July.

Lexington saw a number of restaurant openings, and a few notable closings, including A la Lucie, Billy’s Bar-B-Q, and Natasha’s. Faced with competition from several bread bakeries in town, 30-year-old Great Harvest Bread, closed its two stores.

Ashland Inc. announced plans in September to split into two independent, publicly traded companies. Ashland will now focus on specialty chemicals, while Valvoline will have the auto lubricant and maintenance businesses.

Tempur Sealy, the world’s largest bedding company, went through a bitter shareholder fight that ended with three top executives being bounced. That was followed by a corporate streamlining that resulted in 50 employees being laid off from the Lexington headquarters.

Lexmark paid $1 billion in March to acquire Kofax, which provides information software for financial services, insurance and health care companies. It was the latest of many acquisitions for Lexmark, which has struggled to diversify beyond printing. The company, which has 2,300 employees in Lexington, announced in July that it was cutting 500 of its 12,000 worldwide employees.

In October, there were press reports that Lexmark was for sale. The company confirmed the possibility, saying its board “has authorized the exploration of strategic alternatives to enhance shareholder value.”

Lexmark ended the year with bad press for firing several hundred workers at a printer cartridge factory in Juarez, Mexico, after they went on strike for a 35-cent a day raise and the right to unionize. The workers now earn $4.03 per day.

Kentucky’s coal industry, especially in Eastern Kentucky, continued a 30-year decline in employment with another year of steep losses. Coal employment stood at 9,356 on Oct. 1 — less than half the number employed in 2011.

While industry executives and some politicians like to blame environmental safety regulations and President Obama, the main factors in coal’s decline are cheap natural gas, depleted Eastern Kentucky reserves and mining costs that are no longer competitive on the world market.

It was a big year for horse racing, as the Breeder’s Cup came to Keeneland and visitors spent a lot of money. The Red Mile had a major makeover, mainly to make room for 902 machines that look a lot like slots and let people bet on previously run horse races.

Lexington’s growing health care sector saw the opening of Baptist Health’s $240 million expansion, which was five years in the making. The University of Kentucky’s Chandler Medical Center continues to grow, and ground was broken in March for a $47 million Shriner’s pediatric medical building nearby.

A couple of notable acquisitions from 2015: The Jockey Club in February bought the Lexington-based Blood-Horse media company, and Wilson Sports Equipment in March bought Louisville Slugger, the venerable manufacturer of baseball bats.