Stellantis Chooses Indiana Over Michigan for EV Battery Factory

Bridge Michigan
Paula Gardner
May 24, 2022

The European parent company of Chrysler looked just past Michigan’s border to choose Indiana for its newest $2.5 billion electric vehicle factory.

The move — announced Tuesday by Stellantis and its partner, Samsung SDI — is said by the companies to generate 1,400 jobs and solidify EV production in northern Indiana, about 100 miles south of Niles, Michigan.

“It’s a win for American manufacturing,” Glenn Stevens, executive director of MICHAuto, Michigan’s organization dedicated to the automotive industry, told Bridge Michigan. “There’s no doubt about that.”

“But we would have liked to have had that plant in Michigan.”

State officials have said attracting the growing EV production capacity is critical for Michigan’s future.

While celebrating a handful of multi-billion-dollar EV wins in the past year — including battery plants in Lansing and Holland, along with production expansion at General Motors’ Orion Township factory — other reminders keep underscoring that Michigan is battling for its place in electrification.

Hyundai, which operates a technical center east of Ann Arbor, just chose eastern Georgia for a $5.5-billion factory. Toyota, which operates an R&D facility south of Ann Arbor, picked North Carolina for its new battery plant.

And last fall, Ford Motor Company looked to Kentucky for a new battery plant and Tennessee to build its Blue Oval City EV megacampus, sites attracting a combined $11.4 billion in investment by the Dearborn-based automaker.

“Today’s announcement proves once again that the landscape remains fiercely competitive for automotive and EV manufacturing projects,”  Quentin Messer Jr., CEO of the Michigan Economic Development Corporation, said in a statement.

Stellantis’ Dare Forward 2030 strategic plan calls for annual sales of 5 million EV units globally by 2030, including half of all of its U.S. auto and light duty truck sales.

To reach that goal, the company — like Ford, GM and others — is aligning with global battery companies to increase production, often in close proximity to the vehicle assembly facilities. Stellantis plans five massive battery factories, with three more to join the ones already announced in Windsor, Ontario, and now Kokomo.

Michigan increased efforts to become more competitive for new factories in 2021 when it established $1 billion in funding for economic development incentives. The Legislature approved the bipartisan Strategic Outreach and Attraction Reserve (SOAR) legislation that created the fund in mid-December. Gov. Gretchen Whitmer approved it shortly thereafter.

The move signaled statewide political unity toward attracting major projects to the state, said Stevens of MICHAuto. Other key roles in corporate site selection include talent development and an accessible workforce; electricity access for the battery packs; and project-ready sites, he said.

The state has one identified so-called “mega-site” capable of accommodating a large-scale project. Located in Marshall, near Battle Creek, it has been available for several years but it is not close to being ready for acquisition or construction, James Durian, CEO of the Marshall Area Economic Development Corporation, told Bridge last spring.

Since the SOAR fund was approved, Durian said, the MDEC has initiated work on the property, including taking soil borings for analysis, “to make it competitive with (land in) other states.”

Other Michigan sites have not received state-level investment to bring them up to current development standards, one of the goals of the SOAR fund.

Messer of the MEDC said Stellantis’ decision underscores “the urgency required in expanding our site preparedness efforts.”

Stellantis remains critically important to Michigan’s automotive industry, Stevens said. Chrysler was founded in the state and still has over 41,000 employees in Michigan.

Its ties to Michigan include factories in Dundee, Trenton, Sterling Heights and Detroit, but also engineering and R&D, including at the Auburn Hills corporate headquarters for North America.

“They are no doubt one of our most important corporate citizens when it comes to research development, engineering and advanced manufacturing,” Stevens said.

“So, as electrification happens, we want to make sure that we’re right there as partners with them.”

Stevens said Michigan is making progress on workforce training needed for the EV and other high-tech industries.

On Tuesday, the Michigan Strategic Fund approved $1.5 million in support for the Semiconductor Apprenticeship Network Program, which is intended to address a shortage in the semiconductor workforce, and another $1.5 million for a MiREV EV Jobs Academy planning grant. Announced by Governor Gretchen Whitmer in September 2021, the Michigan Revolution for Electrification of Vehicles Academy/Academies initiative was created to prepare workers for the mobility industry.

Meanwhile, construction on the Kokomo plant, which will be located near an existing Stellantis factory in Kokomo, will begin later this year, the company said. Information on its size and specific location was not available Tuesday afternoon.

View the original article.

Why Michigan Lost to Indiana for Stellantis Battery Plant

The Detroit News
Breana Noble
May 25, 2022

Jeep maker Stellantis NV’s selection of Kokomo, Indiana, for a $2.5 billion battery plant with South Korean battery manufacturer Samsung SDI that will create 1,400 jobs shows Michigan needs to double down on efforts to attract investment needed to continue its leadership in the new age of automotive manufacturing, according to industry observers.

The transatlantic automaker on Tuesday said it will begin production later this year on the plant offering an initial annual production capacity of 23 gigawatt hours when it launches in 2025 to supply North American vehicle assembly. The aim, however, is to grow the Indiana plant to 33 gigawatt hours, which would increase the investment up to $3.1 billion.

With Stellantis’ long-term strategy calling for two battery plants in North America through 2030, Michigan could be at a loss for such a critical investment in an electrified mobility future for the next decade, potentially jeopardizing its manufacturing leadership. Meanwhile, other states claiming major investments from its hometown automakers, foreign makes and EV startups are championing themselves as the future.

“The state of Indiana has always had a rich automotive heritage,” Indiana Gov. Eric Holcomb said during a news conference in Kokomo, “but with today’s news, we all just became a lot richer.”

The Indiana Economic Development Corp. has committed to more than $186.5 million in support for the project, including in tax credits, training grants, infrastructure improvements, other site readiness efforts and repayable financing support for construction. Additional incentives came from the city, Howard County, utility Duke Energy Corp., which declined to share specifics, and others.

Kokomo beat out Monroe County’s Dundee, where Stellantis has a 1.3-million-square-foot engine plant, The Detroit News previously reported. A roughly 400-acre site in Marshall also was considered. Locations in Wayne County were presented, but properties near Belleville and Trenton were deemed too small.

With a nearly 90-year history in Kokomo, Stellantis already has five components’ plants in the area and resumed production last year at a formerly idled transmission plant to make engines. A $229 million investment in its operations there was announced in October. The new plant will be kitty corner from Kokomo Engine Plant at 2644 N. 50 E, a parcel owned by the Greater Kokomo Economic Development Alliance. Other parcels needed are under option.

Duke Energy will meet with the joint venture to work out the infrastructure needed for the new plant, said Angeline Protogere, spokesperson for the utility in Indiana. It has planned 800 acres of solar panels to power the facility, Mark Stewart, chief operating officer of Stellantis in North America, said in Kokomo.

Industrial energy prices in Indiana were slightly less than Michigan in March at 7.83 and 7.88 cents per kilowatt hour, respectively, according to the U.S. Energy Information Administration.

Stellantis’ familiarity with the company was a factor since Samsung SDI is new to doing business in the United States, Stellantis CEO Carlos Tavares said on Tuesday during a virtual roundtable. He didn’t provide specifics on why other sites missed out.

Kokomo is “a place that is quite well-positioned to have a weighted average outbound logistic cost that is competitive,” he said. Stellantis has four assembly plants in Metro Detroit and one each in Toledo and northern Illinois.

“If you pile up the outbound logistics, the fact that we feel at home, and it was indeed a good (incentive) package that I will keep confidential as a matter of respect to my partners, it was the right thing to do.”

It’s a tough loss for Gov. Gretchen Whitmer’s administration, which has emphasized economic development during a critical election year and comes ahead of next week’s Mackinac Policy Conference. During her tenure, 21,600 auto jobs have been added and billions of dollars in investments announced, including the first assembly plant in Detroit in nearly three decades, according to her office.

Michigan Economic Development Corporation CEO Quentin Messer Jr. in a statement said Tuesday’s news showed the urgency required in expanding the state’s site preparedness efforts.

“Like other states or provinces, Michigan is competing aggressively to earn future investments by Stellantis,” he said in a statement. “While no single state can, or will, win every EV and mobility investment, Michigan’s pipeline remains strong and we remain laser-focused on working closely with our partners across state government, the legislature, our utilities and our regional partners to continue make the strong case for Michigan. Work remains and we are more than up to the task.”

He pointed to General Motors Co. saying in January that it will construct a battery plant in Delta Township outside of Lansing with LG Energy Solution, which in March said it was quintupling production at its existing battery plant in Holland. Those came after the Detroit automaker announced two other plants in Ohio and Tennessee and Ford Motor Co. said it was investing $11.4 billion for an EV assembly plant and three battery plants with partner SK Innovation Co. Ltd. in Tennessee and Kentucky.

Battery manufacturers, other automakers and EV startups have chosen states like Arizona, Georgia and South Carolina for still more battery plants.

“The Stellantis announcement shows that there’s many states that are going to compete,” Josh Hundt, the MEDC’s chief business development officer, told The Detroit News. “We need to make sure we continue to have the toolkit, the talent and land available for projects of this type to happen here in the state.”

Embarrassed by Ford’s Southern commitment, Whitmer and GOP lawmakers in December passed a new incentive program to solidify the GM project. The Strategic Outreach and Attraction Reserve, or SOAR, was a $1 billion incentive fund to help speed closure of a multibillion-dollar investment deal with GM and invest in site readiness.

Efforts like that along with the appointment of a new chief talent solutions and engagement officer are fresh signs of Michigan’s significant commitment to doing what it needs to do to attract investments — even leading up to a contentious election for state offices this fall.

“Michigan has to be able to compete with Georgia or Indiana or any other state or region,” said Glenn Stevens, executive director of MICHauto, the mobility arm of the Detroit Regional Chamber. “To do that, everyone has to be on the same page with everybody committed to better jobs.

“I think that there has clearly been a step, that the business climate and incentives are in place. That can’t be short-term. It has to be a long-term commitment.”

The Democratic governor has a pending request before the Republican-controlled Legislature for $500 million for cash grants to help seal economic development deals and pay for infrastructure improvements to make sites shovel-ready.

“Working together with the Legislature, we must keep making forward progress to put Michigan in the best position to compete for every project,” Whitmer spokesman Bobby Leddy said in a statement. “As the industry evolves at a rapid rate, Governor Whitmer will continue to put her foot on the gas to get deals done that create jobs and put Michiganders first.”

Shane Karr, Stellantis’ external affairs head in North America, described the Kokomo site and Indiana’s economic development team as “ready-to-go.”

Those greenfield sites outfitted with utility infrastructure and ready for construction are the most desirable for automakers facing bottlenecks for EV production, because there are not enough batteries, said Bernard Swiecki, director of automotive communities’ partnership and research at the Center for Automotive Research in Ann Arbor.

“It lets you begin production faster,” Swiecki said. “There’s a huge priority for that in the early days of this. As time goes on, maybe you won’t have as much of a time crunch. That point does free up brownfield sites, places where Michigan has a better shot.”

The new Indiana battery factory will use Samsung’s PriMX lithium-ion battery technology for vehicles assembled in North America.

UAW Vice President Cindy Estrada said in a statement the union will look to add the plant to its ranks and negotiate an agreement with Stellantis that brings the new plant under the UAW’s master agreement with traditional wages and benefits.

UAW President Ray Curry added in a statement: “UAW applauds the decision to invest in domestic production, and our union looks forward to being a part of its success. As President Biden recently said during his visit to South Korea, the most highly skilled and dedicated and engaged workers in the world are American union members. We look forward to having UAW members be a part of the success of this new joint venture.”

The plant is smaller than the gigafactory Stellantis announced in March for Windsor, Ontario, with LG Energy Solution. That $4.1 billion plant’s annual capacity is expected to be more than 45 gigawatt hours and launch in the first quarter of 2024, supplying 2,500 new jobs.

Stellantis is investing $35.5 billion into electrification and software by 2025. It says it will have around 400 gigawatt hours of annual capacity by 2030 across five gigafactories, including three in Europe and the two in North America. By then, it expects more than half of its U.S. sales will be all-electric with 25 available models.

“Sometimes people think that we’re behind,” Stellantis’ Stewart said. “We are not.”

View the original article. 

Michigan Legislators Test Drive EVs at the Capitol

On Tuesday, May 17, MICHauto, in partnership with Michigan Conservative Energy Forum and Clean Fuels Michigan, sponsored an EV Ride and Drive Showcase at the Capitol. The Showcase included vehicles from Ford, Stellantis, Rivian, and Tesla and gave legislators the opportunity to test drive EVs and discover the electric future transforming the mobility industry in Michigan and throughout the nation.

 

MICHauto Strategic Agenda for the Mackinac Policy Conference

MICHauto stakeholders and staff are headed to the Detroit Regional Chamber’s 2022 Mackinac Policy Conference with a game plan and strategic agenda to raise awareness of the automotive and mobility industry’s most pressing issues. In an era of routine global disruption and cutthroat competition for talent, our economic development and political leadership need to position Michigan’s signature industry to win for the future.

While at the Conference MICHauto stakeholders and staff will advocate that Michigan take the following actions to ensure a path for long-term growth and prosperity for the automotive and mobility industry.

  1. Build the Talent Pipeline: Michigan must secure the high-tech talent pipeline to develop, retain, and attract the knowledge economy jobs and the people to fill them.
  2. Strengthen the Business Climate: Cultivate a stronger startup and mobility business climate through competitive incentives and minimal regulation to attract game-changing economic development projects.
  3. Champion the Electrification Revolution: Lead the nation in the electrification revolution by deploying a more economically competitive power grid, building out the state’s EV charging infrastructure, and securing more electric battery production and recycling facilities in Michigan.
  4. Invest in Communities: Prioritize funding for infrastructure, recreation, broadband, educational, and cultural assets to strengthen placemaking across the state to ensure there are an abundance of premier destinations to live, work, and play.

MICHauto’s Glenn Stevens Jr. Named Among 2022 Crain’s Detroit Business Notable Leaders in EV

MICHauto is proud to celebrate Executive Director, Glenn Stevens Jr., for being named among the Crain’s Detroit Business 2022 Notable Leaders in EV.

We’re living through a shift in the automotive sector that may be as profound as the invention of the automobile itself: the electric vehicle revolution. Crain’s Detroit Business Notable Leaders in EV are heading up the charge at automakers and suppliers large and small, developing innovative battery technology and charging solutions, implementing electrification plans for municipalities and training up the next generation of EV leaders.

About Glenn Stevens Jr.

Executive Director, MICHauto; Vice President of Automotive and Mobility Initiatives, Detroit Regional Chamber

As a volunteer in 2006, Glenn Stevens Jr. worked with industry colleagues to write the business plan for MICHauto, a nonprofit launched in 2007 to grow Michigan’s auto industry. Stevens, who became executive director in 2014, collaborates with OEMs, suppliers, colleges and universities, state agencies and others to work toward that goal.

In 2015, Stevens led the creation of the Michigan Mobility Initiative, an alliance between MICHauto, the Michigan Department of Transportation, Michigan Economic Development Corp. and others to prepare Michigan for electrification, autonomy, mobility and connected vehicles. In 2016, he co-founded the Detroit Mobility Coalition, which leads the Michigan High-Tech Talent initiative and partners in MiREV.

“Glenn is a champion and leader of the EV revolution — a connector of people, a builder of coalitions, a strategist and dot connector who whispers revelations to business executives, journalists and other influencers critical to Michigan’s quest to lead the new era of mobility,” said Ron Fournier, president of Truscott-Rossman.

View the full list of Notable Leaders in EV 2022.

Howes: Michigan losing race to win more EV factories

The Detroit News
Daniel Howes
May 8, 2022

Leadership in electric vehicle production and battery assembly is up for grabs, and evidence strongly suggests the home of Detroit’s automakers keeps falling behind.

Automakers old and new are placing bets on EV-related production and development hundreds of miles from the Motor City, laying bare the perception and sometimes the reality that this state is getting lapped in the parallel races for electrification and job-creating investment.

Just ask the governors of Kentucky and Tennessee, each touting massive EV and battery projects in their states — from Michigan’s own General Motors Co. and Ford Motor Co. Or Canada’s prime minister, Justin Trudeau, now holding Stellantis NV’s pledge to partner with LG Energy Solution to produce batteries in Windsor and a GM plan to assemble battery-related materials in Quebec, among other things.

Hey, Lansing — these are not encouraging trends if you’re serious about securing Michigan’s leadership in next-generation electric vehicles and battery production. Walbridge Co., the Detroit-based commercial construction firm that builds auto plants and other facilities around the world, identified 70 electric vehicle and battery-related projects across the United States, Chairman John Rakolta Jr. told The Detroit News.

Leadership in electric vehicle production and battery assembly is up for grabs, and evidence strongly suggests the home of Detroit’s automakers keeps falling behind.

Of those, just nine are considering Michigan. And only two — GM’s announced battery plant in Delta Township near Lansing and its conversion of Lake Orion Assembly to electric truck production — are pledged to Michigan. They’re part of what Walbridge estimates to be $200 billion in investments for battery-electric assembly plants, battery production, diode and cathode sub-suppliers, semiconductor chip plants and aluminum production.

More EV- and battery-related investments in Michigan are possible, even likely. Mark Stewart, chief operating officer of Stellantis North America, last week signaled that Michigan “absolutely” is in contention for at least one of as many as three EV battery plants in North America, and that a decision should come within a month or “two months maximum.”

But the concentration of startups and foreign-owned assembly plants in Ontario, Indiana, Ohio and a swath of Southern states — and the growing list of battery operations located nearby — signals that the state credited with assembling more vehicles than any of its peers nonetheless is on track to lose more than it wins.

With the exception of Mazda Motor Corp.’s now-dissolved dalliance with Ford Motor Co. at its Flat Rock Assembly, not a single foreign automaker has located a U.S. plant in Michigan. And that stubborn fact does not strengthen the state’s efforts to land EV- and battery-related investments now mostly accruing to Southern states.

“The market is telling you Michigan is uncompetitive,” Rakolta said. “This is passing us by at breakneck speed. We won two, three out of nine so far. Even if we win all nine, it’s not sufficient to replace what we’re losing. Momentum … is taking place right now.

“This is not a problem that has a silver bullet. This is existential, I believe, to the state of Michigan. There is no cohesion in Michigan. Two, we don’t have ready sites. We all know what’s going on. The question is, do we have the fortitude to change?”

Not so much, if the past is any indication. Ford’s decision last fall to join with a battery partner to invest $11.4 billion — its largest manufacturing investment in the Blue Oval’s 118-year history — in Kentucky and Tennessee shocked and angered Michigan’s complacent leadership, chiefly because the move blew a multibillion-dollar hole in an Auto 2.0 narrative reeking of entitlement.

Battling back

Embarrassed, Michigan responded by creating the “Strategic Outreach and Attraction Reserve,” or SOAR, a $1 billion incentive fund quickly arranged to help speed closure of a multibillion-dollar investment deal with GM, a transaction paired with a competitive industrial utility rate package quarterbacked by DTE Energy Co.

“What we’ve done for General Motors, we can do for anyone,” DTE CEO Jerry Norcia said in an interview earlier this year. “The Ford announcement caused a lot of deep reflection of everyone involved. We really need to build capacity to invest in EV assembly and batteries.”

However positive Ford’s launch of its all-electric F-150 Lightning pickup in Dearborn, or GM’s revival of Detroit-Hamtramck Assembly building the Hummer EV and, soon, its electric full-size pickups, evidence mounts that no single place is likely to own the electrified future.

In another hit to Michigan, Stellantis last week also said it would invest $2.5 billion to renovate plants in Windsor and Brampton, Ontario, in preparation for their transition to building EVs. And the transatlantic automaker pledged to expand its Automotive Research and Development Centre in Windsor to create a battery lab to develop all-electric and hybrid cells, modules and battery packs.

The challenge is intensifying. Startups like Lucid, Rivian, Nikola and heavyweight Tesla are building vehicles in Arizona, Illinois, California and Texas. Foreign-owned legacy rivals Honda Motor Co., Nissan Motor Co., Volkswagen AG, Toyota Motor Corp., Mercedes-Benz, BMW AG, Hyundai Motor Co. and Subaru Motor Co. are planted in Ohio, Tennessee, Kentucky, Indiana, South Carolina, Georgia, Alabama and Mississippi.

And as many of Detroit’s rivals add electric vehicles to their U.S. production plants — near certainties in the launch of new EVs — battery-related operations to supply those plants are likely to follow. BMW, Nissan and Hyundai are scouting sites for U.S. battery operations, too. The upshot is a shift in the critical mass of electrification away from the traditional heart of the American auto industry.

“Half the die is already cast,” said Patrick Anderson, CEO of the East Lansing-based Anderson Economic Group. “Where they’re assembling these vehicles is the No. 1 factor in where they locate these facilities.”

If geography is destiny, the hard realities of the map do not bode well for Michigan’s bid to claim leadership in the industry’s increasingly hard pivot to electrification. Nor does the unmistakable post-pandemic trend toward full-time remote work, likely to be intensified by automakers’ efforts to recruit new kinds of tech talent working around the country.

Among the risks: that remote work and invest-in-battery-production where you assemble could form a perfect storm to diminish the concentration of knowledge-based auto talent in Michigan, among other industry strongholds. What those trends portend for places like Detroit, Warren, Dearborn and Auburn Hills are hard questions that cannot be denied.

Wake-up call

The quickening change is no secret to state officials scrambling to claim a share of the EV gold rush, according to a ranking source familiar with the matter, describing a “historically” high rate of activity in the EV-related investment pipeline. The trouble is most projects announced outside Michigan are perceived — if not actual — losses eroding the state’s claim of leadership.

The more others win, the harder it will be for Michigan to dispel whispers that the home of the first automotive century is losing its grip on the next one. Such a wound is largely self-inflicted, the economic and civic culmination of the state’s collective refusal to reckon with its workaday culture, comparative lack of educational attainment and increasingly toxic, hyper-partisan politics.

Last week, the CEO of Business Leaders for Michigan, Jeff Donofrio, used a Detroit Economic Club meeting to detail a new benchmarking analysis of the state’s competitive position with other states. The bottom line: Michigan’s relative position is much improved from the dark days of auto bankruptcies amid the global financial meltdown, but rival states are improving at faster rates and landing more job-creating investment.

Nearly 170,000 jobs in Michigan are potentially at risk amid the EV transition, BLM estimates. Over the past dozen years, the CEO group says the state moved to 15th from 49th among the 50 states in business competitiveness. Also over the past decade, Georgia and Kentucky have passed Michigan in educational attainment and Tennessee — future home to Ford’s sprawling Blue Oval City — is drawing closer.

“Tennessee’s not messing around, either,” said Glenn Stevens, vice president and executive director of the Detroit Regional Chamber’s MICHauto, explaining that the Volunteer State has been shoring up its workforce development programs and community college system. It also notched an 8,500-person, $1.2 billion campus in downtown Nashville for software giant Oracle Corp.

“The same thing can be said for Kentucky. Indiana is all-in. The competition is really tough,” he added. Ohio landed one of GM’s battery plants near Lordstown, and Intel Corp. is investing $20 billion near Columbus to build two “leading edge” semiconductor chip plants employing thousands and reshaping Ohio’s industrial narrative. Intel’s total investment there is nearly three times GM’s pledged investments in Delta Township and Lake Orion.

And Ontario’s aggressive strategies to build a high tech cluster it calls “The Corridor,” to invest $2 billion in a minerals strategy for EV mining supply chain to develop strategies for electrification and software development, is drawing reinvestment by GM and Stellantis not far from Detroit.

Failed imagination

Michigan is just too slow.

For more than a decade, imperatives to attract and retain talent, to boost educational attainment, to coalesce Republicans and Democrats around a shared vision for the state’s economic future have consistently fallen short. Why? Because things have been too good, economically speaking, and this place doesn’t do big, hard things unless its collective back is against the wall.

Examples: think Ford’s restructuring under former CEO Alan Mulally; think the pitiless workouts of GM and the old Chrysler Group in federally induced bankruptcy; think the bankruptcy of Detroit. Even the recent creation of the SOAR fund to woo GM investments amounted to a panicked reaction to the massive Ford deals in Kentucky and Tennessee.

Second, partisan politics have morphed into demonizing the other side, making “consensus” and the “cohesion” of Rakolta’s telling risible concepts to the governor, lawmakers and those who would take their places. Smart CEOs whose companies are not deeply rooted here would think very long and very hard about investing billions in a state governed more by ideological grandstanding than enlightened economic pragmatism.

That’s why Michigan’s marquee Auto 2.0 investments of the dawning electric century come from GM and not Toyota, Ford and not Volkswagen. It’s why LG Energy Solution is investing to expand its operation in Holland and create 2,000 more jobs — because it knows the state. Others not already heavily invested here have options.

Third, leaders here too often project a failure of imagination, aggravating their disinclination to lead. Southern governors play offense and work with their respective legislatures, and the results speak for themselves; Michigan’s governor plays defense and exhibits scant aptitude for managing Republican leaders — except under duress — and it shows.

Now, this being a statewide election year, there’s always the lurking possibility the state could land a big next-gen project promising thousands of jobs and a tech-driven narrative akin to Ohio’s Intel win. But that assumes hurdling such deficits as suitably large (and development-ready) sites, comparatively high utility rates and Republican reticence to give an election-year win to a Democratic governor seeking a second term.

The next automotive century, mostly powered by electricity, does not belong to Michigan. It’ll go to the places that hustle hardest and demonstrate by what they do that their job is providing the conditions business needs to prosper. And, right now, Michigan is at serious risk of missing that moment.

View the original article.

Stellantis’ $2.8 billion investment secures future for Brampton, Windsor plants

The Detroit News
Breana Noble
May 2, 2022

The maker of Chrysler, Dodge, Jeep and Ram vehicles on Monday said it will invest $2.8 billion (3.6 billion Canadian dollars) into its Canadian operations for its electric transition, preserving the futures of both Windsor and Brampton assembly plants and creating its first battery lab in North America.

The amount is more than double the commitment Fiat Chrysler Automobiles NV made in 2020 contract talks with Canadian autoworkers union Unifor prior to merging with French automaker Groupe PSA to create Stellantis NV last year. The transatlantic automaker has pledged to become a sustainable mobility tech company, investing $35.5 billion into electrification and software by 2025 to offer 25 all-electric models in North America by 2030.

“We hope today’s announcement,” Mark Stewart, Stellantis’ chief operating officer of North America, said during a news conference in Windsor, “really helps bring assurance to our families, to our employees and the local community that we are committed to Canada in the long run and for the next 100 years.”

A new, flexible architecture that will support all-electric and hybrid vehicles will go to Brampton Assembly Plant outside of Toronto. Industry forecasters had predicted the plant employing more than 3,000 people on two shifts could be without product by 2024 if the company moves production of the aging Dodge muscle cars to Belvidere, Illinois, when they are electrified. In addition to the Challenger and Charger, Brampton builds the Chrysler 300 sedan. With the new plan, Brampton will be retooled starting in 2024 with production resuming in 2025.

Windsor Assembly Plant also will support production of battery-electric and hybrid models on a new architecture for multiple models, according to a news release. Retooling is planned to begin in 2023, though the automaker declined to provide a time for completion. The plant will be able to adjust production volumes as needed to meet changing demand over the next decade, the company said.

Stellantis said it will make product announcements for the sites in the future, but the plans will return both plants to three-shift operations. The company declined to provide a breakdown of the investment per facility and projections for how many jobs would be created at or supported by the assembly plants.

“We are really excited about the lineup that is going to be an expanded to help maintain any cyclicity,” Stewart said, “so that we have multi-energy vehicles, full-on battery electric vehicles, and we can be sustainable for the future with our Stellantis families in the market.”

The news comes after the automaker on Thursday said it was extending the 1,800-person second-shift at Windsor Assembly Plant through the end of the year. The company had been set to cut the shift at the Chrysler Pacifica plant at the end of June because of a global semiconductor shortage. In the first quarter, Stellantis sold more than 26,000 Pacificas in the United States, down 23% year-over-year.

“Windsor has made really strong improvements over an already good, good performance, and so they are getting the allocation of chips in a land of precious few chips to be able to do that,” Stewart said. “Those plants have shown they can be competitive, and our customers are aching for those products.”

Additionally, by the end of 2023, Stellantis will add 100,000 square feet to its Automotive Research and Development Centre in Windsor for the creation of a battery lab for the development and validation of all-electric and hybrid cells, modules, and battery packs. The expansion to the 230,000-square-foot facility will support 650 new engineering jobs to support electrified propulsion systems, power electronics, electric machines, motor controls, energy management, and embedded software.

The investments are another victory for the province of Ontario, which has made strides to improve its ability to attract business and has allocated hundreds of millions of dollars in incentives to do so. The mobility sector has been a focus to preserve its automotive industry, which could’ve been in jeopardy with the transition to electric vehicles. Meanwhile, suppliers even across the Detroit River stand to benefit from continued investment in the region.

“Ontario and Michigan, our industries are completely interconnected, just separated by a river and bridges,” said Glenn Stevens, executive director of MICHauto, the mobility arm of the Detroit Regional Chamber. “The health of one is important for another. There are many suppliers that supply the Tier 1s or the assembly plants throughout Ontario. When a major assembly plant like Brampton gets a new lease on life, certainly the Ontario suppliers are feeling good, and many Michigan suppliers that supply that assembly plant are as well.”

He recalled attending a gathering in 2016 in Windsor with a number of industry stakeholders that felt like a “town hall crisis meeting” after the region had seen manufacturing move to the southeast United States and Mexico.

“They put together a strategy to put a tremendous amount of investment in the knowledge part of the economy,” Stevens said. “It is a really strong message or reminder to us here in Michigan how important investment into high-tech talent is. They have been doubling and tripling down on it.”

Ontario is supporting Stellantis’ projects with up to $397 million (513 million Canadian dollars), which breaks down to $222 million (287 million Canadian dollars) for Windsor, $102 million (132 million Canadian dollars) for Brampton, and $73 million (94 million Canadian dollars) for the ARDC. Canada’s federal government is providing an additional $410 million (529 million Canadian dollars) in incentives.

“Investing in this multi-billion-dollar project is because it’ll deliver,” Canadian Prime Minister Justin Trudeau said during the news conference. “It’ll deliver for workers, it’ll deliver for communities, it’ll deliver for our economy, and it’ll deliver for the environment. Not only are we growing a world-leading auto industry, creating hundreds of jobs and securing thousands more, we’re keeping our air clean by building and driving more EVs here at home.”

Over the past 18 months, the automotive sector in Ontario has seen almost $11 billion (14 billion Canadian dollars) in investments for new vehicle and battery manufacturing. Government officials last month joined Stellantis leaders and executives from Korean battery manufacturer LG Energy Solution to announce plans for a $4.1 billion gigafactory to make batteries for electric vehicles manufactured in North America.

The plant is expected to create 2,500 jobs and open in the first quarter of 2024. The city of Windsor is in the process of expropriating a home that is a part of the property needed for the facility before the companies break ground later this year.

“Our government has a plan,” Premier Doug Ford said during Monday’s presentation. “It’s a plan to attract more investment in our auto and manufacturing sectors. While we connect resources, industries and workers in Ontario to the future of clean steel and electric vehicles. It will be a plan that sees Ontario take its position as North America’s leader in automotive manufacturing as it was for over 100 years.”

Brampton Assembly was built in 1986, making it one of the newer plants in Stellantis’ footprints, said Sam Fiorani, vice president of global vehicle forecasting for AutoForecast Solutions LLC.

“It had a lot going for it between the age of the plant and the number of workers there, who have 35 years of experience working in that plant alone,” he said. “Then, add in the regional access to a battery plant going into Windsor, it makes sense to put something in there.

“Stellantis had a few underutilized plants that have product earmarked for them going forward, so that leaves Brampton potentially with a white-space product for a space they are not covering at the moment or not adequately covering at the moment.”

With the gigafactory in Windsor, it also makes sense to have a nearby center to test batteries and conduct diagnostics, said Sam Abuelsamid, principal e-mobility analyst for market research firm Guidehouse Inc. Stellanits has announced a battery lab in Turin, Italy, but having one in North America can be advantageous as well.

“They may be using different chemistries for different markets and different types of vehicles they are selling,” he said.

Under the 2020 Unifor contract, FCA had committed to investing $1.13 billion for Windsor Assembly Plant by 2024 for a new platform that supports electrified vehicles. At the time, the former Unifor President Jerry Dias said employment would grow by more than 2,000 starting in 2023 with a 38-week ramp-up of the new platform.

The contract also included derivatives of the Chrysler 300, Dodge Challenger and Dodge Charger at Brampton and new products for Etobicoke Casting Plant, both in Ontario.

“It lays the groundwork for a happy contract next year when the Unifor contract comes up again next year,” Fiorani said of Stellantis’ announcement. “But because the UAW and Unifor bargain at the same time now, they may be itching for a fight with the U.S. union.”

View the original article.

Automobility Day at the Capitol 2022

On April 26, MICHauto hosted its annual Automobility Day at the Capitol. Throughout the day, the MICHauto team and executives from various MICHauto member companies met with legislators and members of the Governor’s Executive Team.

“The MICHauto team is happy to return – in person – this year for our sixth annual Automobility Day at the Capitol,” said Glenn Stevens Jr., executive director of MICHauto. “At this tumultuous moment when manufacturing supply chains are being disrupted by the ongoing pandemic and a war in Europe, and the industry is rapidly transitioning to EVs, it’s imperative for MICHauto to continue to make sure the automotive and mobility industry maintains effective communication and strong relationships with our state’s political leadership.”

During Automobility Day, MICHauto also honored its 2022 Legislator of the Year, State Representative Joe Tate (D-Detroit), with a ceremony in the Capitol Rotunda.

Joe Tate and Glenn Stevens

“Joe’s leadership as a co-Chair of the Auto Caucus and ally to the industry has been indispensable these last several years. But we were especially grateful that we had his strong partnership and voice in late 2021 when we saw the passage of the $1 Billion Strategic Outreach Attraction Reserve (SOAR) fund. Whether in the U.S. Marine Corp., the NFL, or as a legislator, Joe has proven to be a true leader throughout his career. We thank him for his service and look forward to his continued partnership.”

Glenn Stevens Jr., Executive Director of MICHauto

Granholm in Detroit touts Biden plan targeting $3 billion for U.S. EV battery production

Crain’s Detroit Business
Nick Manes
May 2, 2022

The Biden administration will invest more than $3 billion from last year’s massive infrastructure bill in an effort to boost domestic production of electric vehicle batteries, according to a plan unveiled Monday.

The funding from the Bipartisan Infrastructure Law will be used to “bolster domestic supply chains, create good-paying jobs, and help lower costs for families,” according to an administration news release, and funds will be provided by the U.S. Department of Energy.

U.S. Energy Secretary and former Democratic Michigan Gov. Jennifer Granholm said during an event in Detroit on Monday that the $3.1 billion being provided by the federal government will actually be doubled to more than $6 billion. That’s because private sector companies will have to match federal funds, which will create a windfall for the sector, Granholm said.

“That’s a lot of money to build out this part of the supply chain,” Granholm said. “And that means that’s a lot of jobs to build out this part of the supply chain.”

The announcement with Granholm, U.S. Rep. Debbie Dingell, D-Dearborn, and various labor leaders, which followed a White House media call, took place at Focus: Hope, a Detroit-based racial justice nonprofit that provides workforce development, senior meal programs, and other programming.

Portia Roberson, Focus: Hope’s CEO, is running for the U.S. Congress as a Democrat in the new 13th District, which encompasses Detroit’s east side, southwest Detroit and parts of suburban Wayne County.

Encouraging the domestic production of battery minerals has been a priority for the Biden administration as it seeks to electrify half of all new U.S. cars by 2030. But surging commodity prices and supply chain snarls remain a challenge. Earlier this spring, the White House invoked the Defense Production Act to spur output of lithium, nickel, graphite, cobalt, and manganese.

The grants will fund new, retrofitted, or expanded processing facilities, as well as manufacturing demonstrations and battery recycling, according to Energy Department officials. A separate $60 million program for battery recycling is also being made available, the agency said.

The money comes from the $550 billion infrastructure bill signed into law last year, which earmarked $7 billion for batteries and the creation of a U.S. supply chain to produce them.

The funds should help to accelerate domestic capabilities around innovation in EV battery production, as well as helping alleviate snarled supply chains, said Glenn Stevens, executive director of industry group MICHAuto and the vice president for automotive and mobility initiatives at the Detroit Regional Chamber.

While U.S. companies have made strides on overall electrification efforts, European and Asian countries are “far ahead,” particularly with regard to innovation, Stevens said.

The grants from the Biden administration, he said, “will only support that and that’s important because this is an innovation race.”

Additionally, Stevens said the grants appear heavily focused on recycling efforts for minerals found in EV batteries.

As of late March, automakers and their battery suppliers have committed $13.5 billion to create EV battery plants in North America, according to a report in Automotive News.

While the transition to electric vehicles is being embraced by many in the auto industry, politicians and others, many in the supply chain have said that because EVs contain far fewer parts, the move away from combustion engines could spell their doom, as Crain’s has reported.

However, Granholm on Monday said the administration’s EV battery initiative could help alleviate some of that pain, particularly in auto-dependent areas like Michigan.

“The ability to bring all the pieces of manufacturing a battery will create an ecosystem,” Granholm told reporters. “But in places like Michigan, where you really have this concentration, it’s a natural place for those jobs to come.”

View the original article.