One of Europe’s leading manufacturers is receiving a large dose of Southern hospitality.

EFACEC, a Portuguese company that makes electrical transformers, held the official groundbreaking for its Effingham County site Thursday morning, heralding the firm’s investment in the U.S. market.

“This is the result of a long process,” said EFACEC Chief Executive Officer Luis Felipe Pereira. “We believe we have made the right decision.”

The company and state officials signed a memorandum of understanding last November. Work finally has started in earnest on the 55-acre site at the Effingham Industrial Park. EFACEC’s plant and offices will be built on the tract, at the corner of Highways 21 and 275.

Effingham Industrial Development Authority representatives traveled to Portugal and the company’s Porto headquarters for their sales pitch late last spring. EFACEC’s investment in Effingham, including its building, is projected to be around $174 million.

“This is truly going to be an historic event for Effingham County,” said IDA Chief Executive Officer John Henry. “This represents the largest manufacturing facility in the region in the last 20 years. It will bring foreign and domestic attention to Effingham County, and we are demonstrating that Effingham County is truly moving in the right direction.”

The company sold its first mobile substation in the U.S. in 1998 and now its business has blossomed to more than $100 million a year. Its customers include Pacific Gas and Electric, Nevada Power, Progress Energy, Florida Power and Light and Georgia Power.

It also makes large electrical transformers that U.S. manufacturers no longer produce. Westinghouse and General Electric closed down their production lines of large transformers in the 1980s, said Jorge Guerra, EFACEC’s director of business and operations in the U.S.

“There is not a manufacturer in the U.S. who can build those,” he said.

Electrical transformer production in the U.S. peaked in the mid 1970s. Now, those units — with a service life of 30-35 years — need replacing, and that’s on top of the transformers and components that are needed, according to Guerra.

The company’s own plant in Portugal also had reached its capacity, and EFACEC was rejecting orders. The Effingham County facility — in the Effingham Industrial Park at the intersection of Highways 21 and 275 — will allow EFACEC to fill its U.S. needs. Currently, its transformers for its American clientele are being produced in Portugal and shipped over.

“This is an important investment,” Pereira said. “It represents a step in the U.S. market. We are already in the market, but we are supplying our customers from Portugal.”

Phase 1 of the facility will be a building of approximately 226,000 square feet and phase 2 will make it 292,000 square foot. The office also will be built in two phases, finishing at 37,500 square feet.

In 2010, the company projects to produce four shell transformers and 26 core transformers, with 232 employees. By 2017, when the buildout will be complete, EFACEC will turn out 30 shell and 200 core transformers a year with 672 employees.

The company is partnering with Savannah Technical College, Georgia Tech and the state’s QuickStart program to get the training put together for the first wave of employees.

“The people we are working with are exceptional,” said Jan Melcher, director of eastern operations for QuickStart. “Everyone has the same objective of making this a seamless adjustment. It’s important to get the word out. EFACEC’s a very big investment for us.”

EFACEC will take its first wave, potentially as many as 51 engineers and technicians, to Portugal for training beginning in January. Engineers will be there through June and the specialists could be there through August.

“We have prepared an ambitious training program,” said EFACEC’s Manuel Silvestre. “With the support of QuickStart, Savannah Tech and Georgia Tech, we can create a new generation of engineers and high-skilled specialists that can in a short time reach the same level of performance that we have in Portugal.”

The company has chosen an initial set of 35 engineers and specialists out of 118 applicants.

“We are going to be hiring lots of people, mostly engineers,” Pereira said. “We are in the process of recruiting.”

The company made its requirements for a site known to industry consultants, and they came back with four possible sites, two in Georgia and two in South Carolina. EFACEC officials wanted to be near a port and near a campus, Pereira said. The plant will be across Highway 21 from Savannah Technical College’s Effingham campus and 17 miles from the port of Savannah.

“It is the most important investment we have outside of Portugal,” Pereira said. “The U.S. is a huge market for us. With this investment, we will increase our presence in the U.S.”

Heidi Green, deputy commissioner of the Georgia Department of Economic Development, expressed the state’s delight at landing its first Portuguese firm to make a major impact in Georgia.

“Effingham County, you have a real treasure here with EFACEC,” she said. “Welcome to Georgia, ya’ll.