October 24, 2018 | EST. READ TIME: 3 MIN

Local Manufacturer Planning for Another Expansion in Watertown

Another of Watertown’s largest employers is planning an expansion of its operations and hiring more workers.


Dakota Tube is making what it describes as a multi-million-dollar investment into the construction of a new 168,000-square-foot manufacturing facility that will take place in three phases over the next three years.


The company has had a presence in Watertown since moving their operations here from Minnesota in 1985.


“Manufacturing in Watertown continues to thrive, and when companies like Dakota Tube choose to move and operate here, it strengthens the sector even more,” said Chris Schilken, Executive Director of the Watertown Development Company. “This is a significant investment by Dakota Tube. Once again, Watertown is proving to be a major hub for manufacturing and distribution in South Dakota.”


With previous expansions that took place in 2013, 2014 and 2017, this will be the fourth time that Dakota Tube has expanded in Watertown in the last six years. In 2014, with assistance from the WDC, the company completed a building expansion that took place directly across from their location in Lake Air Industrial Park, which added 38,000 square feet to their building complex and totaled more than $2.1 million in capital investment. Phase one begins this week into a 42,000 square foot spec building owned by the Watertown Development Company (WDC) located in Pheasant Ridge Industrial Park.


John Steinbauer, Vice President of Manufacturing for Dakota Tube said, “The new location will produce our high volume and standardized production. We’ve purchased all new equipment for that building which will begin arriving in November. The equipment is very efficient with some significant automation, and the plans for layout and process flow are exciting too.”


The first phase of their expansion is expected to create over 60 jobs with competitive starting wages of $17.00 – $18.00 per hour.


“We’ve not only invested in our equipment and buildings but have also invested in our people and the work environment. We’ve had two rounds of wage increases since the beginning of the year, improved and added to our benefits, and remodeled our employee break areas and restrooms,” said Steinbauer.


News of the Dakota Tube expansion comes on the heels of the Terex Utilities expansion announcement made in April of this year. Since 2010, manufacturing has bounced back strongly from the crater the sector fell into during the Great Recession. In recent months, 17 of the 18 major manufacturing industries are reported to be in growth mode, including manufacturers of fabricated metal products for machinery, transportation, and construction equipment, like Dakota Tube.


Dakota Tube’s customer base is comprised of many of those major global agriculture and construction equipment manufacturers, including Melroe/Bobcat.  “Recently, economic conditions have drastically improved causing a ‘sling shot’ growth in demand from our customers, mostly from construction. People are building more machines than they have any time in the past 10 years. Since we are supplying a higher percentage to the industry, our growth has been pretty large with even more possible if we had capacity,” said Steinbauer.


The first phase of building 3 is expected to start production in April 2019. The 2-year plan to add more space and processes will follow in 2020 and 2021. The company anticipates their total investment to be at least $10 million when phase 3 is complete.


Dakota Tube currently operates from a building complex totaling 183,970 square feet in Lake Air Industrial Park. When phase one of their expansion is complete, Dakota Tube will have the third largest manufacturing building footprint in Watertown at 225,970 square feet.