Fluor to Build $300-Million Auto Factory : Contract: The Irvine-based engineering company will construct the 1-million-square-foot Mercedes-Benz facility near Tuscaloosa, Ala.

As expected, Mercedes-Benz has awarded Fluor Corp. its prize contract to build a $300-million auto plant in Alabama, the companies said Tuesday.

Fluor emerged as the obvious victor last week when Rust International Corp. of Birmingham, Ala.--one of the two engineering firms under consideration by Mercedes-Benz--said it had received a rejection letter from the German auto maker. However, Fluor and the auto maker would not confirm an agreement at that time.

The Irvine engineering company’s core subsidiary, Fluor Daniel, will provide construction management services to the plant. Fluor spokeswoman Deborah Land would not specify the value of the contract to the company. Some of the $300 million budgeted for the plant will go to Albert Kahn Associates Inc., a Detroit architect firm hired by Mercedes-Benz to design the 1-million-square-foot facility.

The plant, scheduled for completion in late 1996, will be Mercedes-Benz’s first U.S. factory to produce passenger vehicles. The luxury-auto maker will build a new sport utility vehicle at the plant near Tuscaloosa, Ala.

Herbert E. Hart, an analyst with the brokerage S.F. Warburg in New York, said Tuesday that the contract will help to diversify Fluor’s portfolio at a time when industrial projects are hard to come by. In the past few years, the bulk of Fluor’s work has been in the hydrocarbon field--building huge oil refineries around the world.

“It’s not one of the multibillion-dollar deals they occasionally get, but it’s nice-sized for an industrial contract,” Hart said. “There has been a lot more business in the energy sector than in the industrial sector, so this contract provides a balance.”

At the end of 1993, industrial projects--such as constructing manufacturing plants--represented 18% of Fluor’s $14.7-billion backlog of orders, while 40% were in the hydrocarbon sector. Only a few years ago, as much as a third of Fluor’s projects were industrial. “Hydrocarbon has been growing, but general industrial work has been in the doldrums because of the economy,” Land said.

Fluor had worked with Mercedes-Benz in scouting out a site for the plant. In October, the auto maker chose Alabama from among half a dozen states offering a multitude of incentives--among them, the $35-million employee training center that Alabama agreed to fund. The state also paid Fluor $150,000 to clear the site of trees and brush for the factory.

Mercedes-Benz spokeswoman Linda Paulmeno said the company has asked that Fluor hire local companies to work on the project. “We want to provide jobs to the area,” she said. “It’s our way of giving back to the community.”

In trading Tuesday on the New York Stock Exchange, Fluor’s stock closed at $40.88 a share, up 13 cents.