Sep. 21--MONTGOMERY -- Critics called Alabama's $253 million incentives package to attract Mercedes in 1993 the granddaddy of economic-development boondoggles.

Fifteen years later, economic marketing strategist Andy Levine with DCI in New York says locating Mercedes here may be the smartest investment any state ever made.

Alabama is now the heart of the new automotive hub in the Southeast.

Alabama Development Office Director Neal Wade said Mercedes "was a game changer" that forever altered the direction of business and employment in the state.

The game change was necessary because Alabama's economic mainstays, farming and textile manufacturing, could no longer provide the stable job sources state workers needed, he said.

"We don't ever want to get to the point again where we depend on one or two types of jobs," Wade said. "We must look for game changers, the mega projects that will bring in new types of jobs."

Does the search for game changers mean states must offer economic incentives, and is the result worth the investment?

"Absolutely," Wade said. "Right now, in the economic equivalent of a 100-year flood, it's even more critical to go after projects."

The competition is not just among other Southern states, and the search long ago became worldwide.

The automotive plants -- Mercedes in Vance, Toyota in Huntsville, Honda in Lincoln and Hyundai in Montgomery -- were the "low-hanging fruit" that brought thousands of other jobs with them, Wade said. Now the state looks to recruit corporate headquarters, and robotics, high-tech and entertainment companies with new incentives.

North Alabama

As for skeptics who still wonder if high-ticket economic incentives pay off in the long run, Wade said, payroll figures alone help explain his support of incentives. The automotive giants that rolled into Alabama beginning with Mercedes paid out $5.2 billion to workers in 2007.

Business experts who track the state's growth and current economic negotiating strategy agree.

"We may or may not like this, but it is a reality," said Kerry Gatlin, dean of the college of business at the University of North Alabama.

"We live in a competitive world, and we must compete.