Sumitomo Drive Technologies to invest $9.3M to automate Chesapeake warehouse

The Virginia Economic Development Partnership announced last week that global power transmission manufacturer Sumitomo Drive Technologies will invest $9.3 million to automate a warehouse and distribution center in Chesapeake, as well as retraining 42 employees.

Sumitomo has maxed out its warehouse space at its U.S. headquarters at 4200 Holland Blvd. in Chesapeake. To address this, Sumitomo says that installing and implementing an automated storage and retrieval system will consolidate 27,000 square feet of inventory to 7,000 square feet. The company will also transition from using forklifts to automated guide vehicles to help manage all inventory.

“This $9.3 million investment in our distribution center is more than just automation — it’s a bold step toward the future,” Sumitomo Drive Technologies Vice President and Chief Operating Officer Tony Barlett said in a statement. “We’re transforming how we operate by embracing advanced automation that will dramatically improve efficiency, speed and service for our customers.”

According to Barlett, the company will not eliminate any jobs. Instead, the company will retrain 42 employees, most of whom will learn to operate the new automated warehouse.

“In fact, one of the most critical aspects of the project is the opportunity it creates to retrain and upskill our workforce,” he said in an email. “The goal of automation is to enhance safety, speed, and efficiency — not to replace people. Our employees remain essential to operations, now supported by smarter tools, expanded roles and growth opportunities.”

According to Barlett, the concept for the project began in the first quarter of 2024, and the contract was awarded in April to Swisslog, a Swiss automation company with U.S. operations in Newport News. Barlett says the project is currently progressing through the design phase. The automation systems are scheduled to go live in the early second quarter of 2026, following testing and employee training.

In addition to being more space efficient, Sumitomo expects the project to increase productivity, with 10 automated guided vehicles supporting material movement. Barlett also says automation creates a safer, more structured work environment. He said the company’s foreign trade zone in Chesapeake will expand from 60,000 to 100,000 square feet to further enhance its distribution operations.

Sumitomo broke ground at its Chesapeake headquarters in April 1988. Today, the company manufactures power transmission and control products for a variety of applications serving customers in food and beverage, parcel handling, automotive and mining. It supplies Cyclo, BuddyBox, Hyponic and Paramax products to customers nationwide. The company is a subsidiary of Tokyo, Japan-based Sumitomo Heavy Industries.

VEDP worked with Chesapeake Economic Development and the Hampton Roads Economic Development Alliance to secure the project for Virginia. VEDP will support the company’s employee retraining through the state-funded Virginia Jobs Investment Program.