Suddenly, Detroit is where the action is for plant investments

March 7, 2020

Automotive News

Alexa St. John

DETROIT — The Motor City’s auto industry once fretted about the seemingly endless stream of capital investment going to rival vehicle assembly plants and supply chains in places around the Southeast and Mexico.
But suddenly, it’s all about Detroit again.

General Motors, Ford Motor Co. and Fiat Chrysler Automobiles have launched a wave of economic development across the greater Detroit area over the past year. New manufacturing projects represent billions in renewed commitments to the auto industry’s traditional capital city. With them comes a decade of business opportunities for the region’s contractors, tooling suppliers, consultants, engineers, parts makers and skilled and hourly workers.

Among the largest investments is FCA’s pledge of $1.6 billion for a second Jeep assembly plant at its Mack Avenue Engine Complex, along with $900 million to modernize the Jefferson North Assembly Plant for the Dodge Durango and Jeep Cherokee.

FCA also is investing $1.5 billion for production of the new Jeep Wagoneer and Grand Wagoneer at its Warren, Mich., truck plant.

GM is pumping $3 billion into electric vehicle and battery module production at its Detroit-Hamtramck Assembly plant. The automaker announced last month that it added 800 workers for a third daily shift at its Lansing Delta Township crossover plant, as well as 400 at its Lansing Grand River facility to bring back the second shift.

Ford invested approximately $750 million to build the Ford Bronco at its Wayne, Mich., manufacturing facility. At its Dearborn, Mich., manufacturing site, Ford pledged nearly $700 million to support production of new electrified variants of its F-150 pickup. Ford also sank $250 million into its Flat Rock facility south of Detroit and $740 million into new mobility projects at its campus in Detroit’s Corktown neighborhood.

Right climate

The investment surge is a reflection of the automakers’ belief that the U.S. market offers growth potential. But the decisions to invest in and around Detroit stem from “aggressive and welcoming” efforts from government leaders at the state and local levels, said Glenn Stevens Jr., executive director of Michauto, an organization within the Detroit Regional Chamber created to “protect, retain and grow” the state’s auto industry.

“There has to be the right business climate for companies to want to either locate here or expand here,” Stevens told Automotive News. “It’s sometimes said that Detroit was the Silicon Valley of the 1920s and ’30s. We’re actually seeing that kind of happen again.”

The investments are a sharp contrast to previous decades, when assembly plant projects gravitated to Alabama, Kentucky, Mississippi, South Carolina and Tennessee. While GM, in particular, struggled with North American factory overcapacity, international competitors BMW, Honda, Hyundai, Kia, Mercedes-Benz, Nissan, Subaru, Toyota and Volkswagen yearned for more North American plants.

The new Detroit-area investments “tell a tale of where the industry is and where it’s going,” Stevens said.

Work force challenge

But Detroit’s automakers still face some challenges — chief among them, talent.
“It’s one thing to announce an investment,” Stevens said. “But you’ve got to have a skilled work force that can make that plant go.

“As we design and engineer next-generation propulsion systems and vehicles, having the right skilled talent in place to do this is absolutely going to be the key factor in really long-term sustainable growth for the city, the region and the state,” he added.

Detroit must transition its work force to keep up with these plant investments and shifting market demands, he said.
“We want people to look at a company like Ford as a high-tech, global and growth- related company,” Stevens said.
“When you look at tech companies like a Google or an Amazon, that’s how people perceive them — as high-tech, global, growth.

“If we’re going to compete for talent in Detroit or in the region, we need the automotive and the mobility industry to be viewed the same way — high-tech, global, growth.”

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Electric vehicle charging bills stalled

March 1, 2020

Crain’s Detroit Business

Jay Greene

  • Legislation awaits action to expand state and national electric vehicle charging network
  • Bills would design and fund EV infrastructure, also give a boost to utility and auto industries
  • Gov. Whitmer’s executive directives could speed up legislative process

Gov. Gretchen Whitmer is doing some “jump starting” of her own in the ongoing effort in Michigan to encourage electric vehicle charging stations.

Last week, Whitmer announced the creation of an office of mobility and electrification and the appointment of a chief mobility officer. The executive directives require state Senate approval.

While the mobility office would have broad responsibilities in promoting electric vehicles, one of its areas of responsibility would be to coordinate public-private efforts to expand and coordinate the network of EV charging stations in all parts of Michigan.

Broadly, the Michigan Council on Future Mobility and Electrification would advise state government on policies that could include projects on autonomous and connected vehicle technology, electric powertrain technology, shared vehicles, commercial and public transportation and the state’s charging infrastructure.

Howard Learner, executive director of the Environmental Law & Policy Center in Chicago, said creating a mobility council will “build on Michigan’s historic transportation expertise in manufacturing and research, and more recent emphasis on electrification and planning for the necessary charging network.”

But legislation that would encourage EV sales and help expand a small but growing network of charging stations in Michigan and the nation has been languishing in Lansing and Washington, D.C.

State Sen. Mallory McMorrow, D-Royal Oak, who is co-sponsoring a bipartisan bill package that could put Michigan at the national forefront in making more charging stations available on state property, at the workplace and in condominiums and apartments, said Whitmer’s executive action could give a boost to the four-bill package.

Since the summer of 2019, the charging station network bill package has been awaiting a hearing in the Michigan Legislature.

“I was over the moon with (the governor’s) announcement,” McMorrow said. “I have discussed this with her and (EV mobility) is a priority for this administration. It is a strong indicator that we will move forward on (the bills) and we have to. There is too much support out there from environmental and business groups.”

McMorrow told Crain’s she has discussed with Sen. Tom Barrett, R-Charlotte, the possibility of holding a hearing on the EV package in the Senate transportation and infrastructure committee. She said he hasn’t committed to a date yet, but she is hopeful he will soon.

Barrett, who is chair of the Senate transportation and infrastructure committee, told Crain’s he is open to the idea, but his committee has been tied down on other priority issues. “The (EV) bills are well-intentioned and have some merit,” Barrett told Crain’s. “Our agenda has been crowded out by other issues.”

Issues include a controversial bill (Senate Bill 431) that would eliminate local control for aggregate mining. Another issue, he said, will be a transportation reform package his committee will consider that could address a transit plan for Wayne, Oakland and Washtenaw counties.

But McMorrow said the EV bill passage also is urgent. She said electric vehicles and infrastructure needs will only multiply.
“EV is happening now,” she said. “Michigan must act aggressively or we will lose out to San Francisco and China. Michigan is the home to autos, and we should be in the forefront.”

McMorrow said the EV bill package seeks to further an April 2019 report issued by the Michigan Energy Office on how many public charging stations are needed in Michigan and where.

The report, written with the assistance of Michigan State University, identified 35 public charging locations in nonurban areas. The cost to install the 193 recommended chargers was estimated at $21.5 million, which would be borne by the state, utilities and private property owners and vendors.

Need for fast EV chargers

Thousands of private and public EV chargers are expected to be installed in Michigan over the next several years to help reduce what experts call “range anxiety,” the fear EV drivers have that they may run out of electricity on long trips.

“Two years ago I got a Chevy Bolt, full electric. I had no charger at home. I wanted to see how it felt for the average person. It is 86 miles to Lansing and back. I was maxing out,” McMorrow said. “I got 170 miles in the winter with battery power. So many problems. Charging stations were mismarked and there were broken charging stations. At the Hyatt in Lansing, the charger broke, then the company went out of business. They have a Tesla charger, but not the same connector.”

But Barrett said he believes range anxiety is overstated. “A 150-mile vehicle range is pretty limited. They are making 250- to 300-mile range vehicles now, with up to 400 miles. If you can charge it at home, you can go far,” he said.

However, McMorrow, an industrial planner by training, said she believes there is one single problem that EV motorists, utilities that want to sell additional electricity and automakers and suppliers that want to sell electric vehicles are facing: lack of EV charging station infrastructure.

“No other state has the history, talent and capability to design and build the next generation of electric vehicles, but we need to have the infrastructure in place to support that development,” McMorrow said.

Utilities funding chargers

Over the past year, DTE Energy Co. and Consumers Energy Co. have begun issuing rebates for EV charging stations at homes and in public locations across Michigan. So far, Consumers Energy has doled out nearly 400 rebates, and DTE about 270. Consumers alone projects it will double the number of EV chargers in its territory from 4,000 to 8,000 by 2022.

According to Consumers Energy, rebates were issued to 200 public station locations and 24 more “fast charging” stations that can power up most of a vehicle’s battery in 30 minutes. The fast charging stations will be located throughout the Lower Peninsula and should be operating by the end of the year, the company said.

EV growth

Some 1.5 million electric vehicles were sold in the U.S. in the last decade, according to the Edison Electric Institute. By 2030, Edison predicts more than 18 million electric vehicles will be on U.S. roads.

“Ford is committed to electrification and has announced plans to invest more than $11B by 2022 to deliver all-new hybrid and fully electric vehicles, including the all-new Mustang Mach-E and our best-selling F-150 which will be produced right here in Dearborn, Michigan,” Ford Motor Co. said in a statement. “We need key stakeholders and government partners to work collaboratively to accelerate deployment of the necessary EV infrastructure to ensure successful consumer adoption of this important future technology.”

GM’s Brian O’Connell, regional director of state government relations, said the auto company believes in an all-electric, zero emissions future.

“We are committed to investing, incentivizing or working with companies to bring charging solutions to the market to best serve customers,” O’Connell said in a statement.

McMorrow said passing the bills also sends a message to job seekers that Michigan is the place to relocate. One employer, Plymouth-based Rivian, an electric vehicle manufacturer, is expanding in Michigan with more than 1,800 workers already employed, she said.

What the bills would do

Starting with the creation of a nine-member Electric Vehicle Infrastructure Council under the state Department of Transportation, McMorrow said the council (Senate Bill 405, House Bill 4786) would consider a range of initiatives that include location of chargers and how to fund them.

The EV council bill would require an interim report submitted to the Legislature in one year with a final report in 18 months.

“Our goal is to bring together utilities, scientists, researchers, environmental groups, private industry and issue recommendations in a report” due one year after bill’s passage, McMorrow said. “We want to roll out the plan on where chargers need to be. Once we settle on good locations, we would work with private companies” along with DTE and Consumers to improve infrastructure” to serve the chargers, she said.

The next two bills (SB 408/HB 4787 and SB 407/HB 4788) would address state parks by allowing the state to install and lease space for charging stations. The revenue that would be generated from leasing those spaces would go toward the park system.

Barrett said he would support bills that would allow parks to lease space for charging stations.
The fourth bill (SB 409/HB 4789) would create tax incentives for small businesses and multi-unit housing to install EV charging stations.

Barrett said he is philosophically opposed to issuing tax credits, but he is willing to listen to the arguments for EV charging stations.

A number of environmental and business groups have endorsed the bills, including the Detroit Regional Chamber’s Automotive & Mobility Initiatives, the Michigan Energy Innovation Business Council and the League of Conservation Voters.

“The next generation of the automobile is quickly evolving from concept to deployment. As electric vehicles begin navigating Michigan’s roads, we will require the sufficient necessary infrastructure to support them,” said Glenn Stevens Jr., vice president of Automotive and Mobility Initiatives with the Detroit Regional Chamber, in a statement.

“The world is moving toward an automated, shared, and connected mobility future — and it is all going to happen on an electrified platform,” Cory Connolly, vice president of policy at the Michigan Energy Innovation Business Council, said in a statement.

Besides McMorrow, sponsors of the bill also include Joe Bellino, R-Monroe; Julie Alexander, R-Jackson; Erika Geiss, D-Taylor; David LaGrand, D-Grand Rapids; Kim LaSata, R-Bainbridge Township; Yousef Rabhi, D-Ann Arbor; and Tim Sneller, D-Burton.

If the bill package is approved this summer, McMorrow said the council would be appointed later this year and by the end of 2021 it could deliver a set of legislative recommendations. She said those could be approved in 2022 with implementation shortly thereafter.

Federal bills waiting
Two congresspeople, Rep. Andy Levin, D-Bloomfield Townships, and Debbie Dingell, D-Dearborn, have introduced bills to expand and fund the nation’s charging stations. Sen. Debbie Stabenow and Rep. Dan Kildee, D-Flint, also have introduced an EV tax credit bill.

Levin’s bill, the Electric Vehicles Freedom Act, would create a nationwide network of high-speed electric vehicle chargers along America’s highways within five years. The bill also would offer grants to state and local governments to develop charging stations. It also would allow private enterprises to develop networks.

“(The Michigan bills) fits in with what I am doing with the larger situation nationally,” Levin said. “At this stage we are gathering co-sponsors. Our principal committee is transportation and infrastructure. We are working with that committee staff and hope for a hearing this year and move the bill” in 2021.

Levin compared what is happening now to build a national electric charging station network with what President Dwight Eisenhower did in the early 1950s with his support of an interstate highway system.

“The momentum behind electrification in transportation bills will result in dramatic change,” Levin said.
Stabenow and Kildee’s bill, the Driving America Forward Act, would raise and extend the current tax credit of up to $7,500 to purchase an eligible electric vehicle.

Dingell’s bill, The USA Electrify Forward Act, would appropriate $2.5 billion annually for the U.S. Department of Energy’s Advanced Technology Vehicles Manufacturing Incentive Program from 2021 to 2035.

McMorrow said the federal legislation only gives more energy to what Michigan is attempting to do with its policies.

“With health care or education, federal and state policies work hand in hand. Historically, what actually pushes the federal government forward is seeing a groundswell from the states,” McMorrow said.

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Gov. Gretchen Whitmer aims to keep Michigan’s ‘pole position’ in autonomous vehicles with new agency

February 25, 2020

By Emily Lawler

A new state agency and other administrative changes will help Michigan maintain its “pole position” in the auto industry as it branches into mobility and automation, Gov. Gretchen Whitmer told a gathering of education and mobility experts at the MICHAuto summit on Tuesday.

“In the state that put the world on wheels and that’s home to some of the most innovating, driven workers on the planet, we must continue to work to solidify Michigan as a global leader in mobility,” Whitmer said in a statement.

The mobility industry includes things like autonomous, electric and connected vehicles and technologies.

On the hood of a car, Whitmer signed two executive orders: one creating the Michigan Office of Future Mobility under the and another creating the Michigan Council on Future Mobility and Electrification. Both are housed under the Department of Labor and Economic Opportunity.

The Michigan Office of Future Mobility, to bed led by a soon-to-be-named director, will coordinate mobility-related initiatives across areas like economic development, labor and infrastructure efforts.

The orders also abolish the Michigan Council on Future Mobility, which was created by a 2016 law and housed in the Michigan Department of Transportation, and create the Michigan Council on Future Mobility and Electrification. The new council will have 17 voting members and advise the governor and legislature on changes to state policy.

Both aim to capitalize on Michigan’s heritage as an auto state, but also move the state into the future “mobility” sector, focusing on things like autonomous vehicles.

The moves “will help us build on the success we’ve seen in the automotive and mobility sectors,” Whitmer said ahead of signing the executive orders.

Jeff Donofrio, director of the Department of Labor and Economic Opportunity, said he’s looking for somebody who understands the industry very well and can help Michigan pivot to the future of the mobility industry.

Detroit Regional Chamber President and CEO Sandy Baruah said Whitmer “is building and expanding on the work to ensure that Michigan’s companies, infrastructure and people are ready to compete, ready to win, and ready to shape the next century of mobility.”

The executive orders earned praise from industry executives.

“FCA applauds the creation of the Michigan Office of Future Mobility and looks forward to working with the Governor and her team to help ensure Michigan remains the home of the quickly evolving mobility industry,” said Stephen J. Buckley, FCA senior technical fellow – electrical engineering in a press release.

Officials from Ford and General Motors also applauded the move.

Whitmer said in order to keep the state’s “pole position” in the industry she is also focused on bolstering the state’s workforce and fixing the state’s roads.

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Whitmer signs orders to advance mobility in the state

February 25, 2020

The Detroit News

By Kalea Hall

Detroit — Gov. Gretchen Whitmer signed executive orders Tuesday to create a council on future mobility and electrification, establish the Michigan Office of Future Mobility and to appoint a chief mobility officer.

Whitmer signed the executive orders atop an Argo AI autonomous vehicle at the MICHauto Summit centered around the state “Leading the Global Mobility Revolution.” The orders follow a year of next-generation investment in the city by Detroit’s three automakers, and are intended to accelerate the auto industry’s momentum in the state.

“Initiatives like these are key to keeping Michigan at the forefront of the future of mobility,” said Bryan Salesky, co-founder and CEO of Argo AI, Ford Motor Co.’s autonomous-vehicle partner. said in a statement. Powered by Ford vehicles, Argo is testing its autonomous vehicles in six cities, including Detroit.

“The deep pools of talent and manufacturing capacity in Michigan are two of the biggest reasons why we’re so proud to operate in this state and have automaker partnership like the one we have with Ford Motor Company.”

The Michigan Office of Future Mobility is expected to help make sure Michigan is “the go-to state to build, test and deploy the cars of the future,” Whitmer said. “The office will also help us continue to build public and private partnerships that drive mobility solutions to ensure we compete globally.”

The state expects to announce who the mobility officer is within the next few weeks, said Jeff Donofrio, state director of the Department of Labor and Economic Opportunity.

Whitmer is directing the Department of Labor and Economic Opportunity to create the office that will be in charge of leading the coordination of all mobility-related initiatives across economic development, workforce and infrastructure needs in the state.

The Michigan Council on Future Mobility and Electrification, which abolishes the current Council on Future Mobility, will be housed at the state’s Department of Labor and Economic Opportunity. The council will be responsible for providing recommendations for changes in state policy.

“Gov. Whitmer and MICHauto are aligned on a vision to shape Michigan’s mobility future,” said Glenn Stevens, executive Director of MICHauto and vice president of automotive and mobility initiatives for the chamber. “MICHauto is honored to be a key partner to Governor Gretchen Whitmer’s administration in executing the executive actions taken today.”

Last year, Michigan saw investments from Fiat Chrysler Automobiles NV, Ford Motor Co. and General Motors Co. — all focused, in some appreciable measure, on fielding electrified versions of top-selling pickups and SUVs.

FCA has earmarked $2.5 billion to retool two plants in Detroit to build next-generation Jeep SUVs and, eventually, electric vehicles. Ford is investing $740 million to renovate a historic site in Corktown and develop future technologies there. GM plans to spend $3 billion at its Detroit-Hamtramck plant to build electric trucks and autonomous shuttles.

“These are exciting investments that are happening here in Michigan, happening because of the incredible assets that we have,” Whitmer said at the summit.

Representatives from all of Detroit three automakers applauded the executive orders.

“Michigan will continue to play a key role in our commitment to advance the future of mobility as evidenced in our recent announcements to create the first all-electric GM assembly plant and manufacture a variety of electric vehicles, including the self-driving Origin, in our backyard,” Brian O’Connell, GM’s regional director of state government relations, said in a statement. “Leveraging our capabilities and research and development leadership, we look forward to working with the state to create an all-electric future.”

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Read Recaps from the 2020 MICHauto Summit: Leading The Global Mobility Revolution

Bryan Salesky Outlines Pathway To A Connected, Autonomous Future

In a one-on-one conversation with Argo AI CEO and Co-founder Bryan Salesky at the 2020 MICHauto Summit, “Autoline” host John McElroy emphasized the accelerated pace of the autonomous and connected vehicle movement over the …

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Darren Palmer: Transforming The Automotive And Mobility Industry

“Freedom of movement drives human progress.”  Darren Palmer, the global director of battery elective vehicles product development at Ford Motor Company, opened his keynote address at the 2020 MICHauto Summit with this Ford …

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Growth In The Global Market

At the 2020 MICHauto Summit, Michael Robinet, executive director of automotive advisory services at IHS Markit, outlined factors in his keynote address that will impact Michigan’s position in the global automotive mobility …

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John McElroy: Michigan’s Auto Industry Embarks On A Dangerous Decade

“Autoline” host John McElroy encouraged attendees at the 2020 MICHauto Summit in his keynote address to be proactive, not reactive, when planning for the industry’s next decade. McElroy emphasized that automakers will face both direct and indirect costs in their innovative practices.  “We are embarking on a very …

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Michigan governor creates office for mobility initiatives

February 25, 2020

Associated Press (AP)

By David Eggert

LANSING, Mich. (AP) — Gov. Gretchen Whitmer announced Tuesday that Michigan will have a mobility officer to coordinate all initiatives related to self-driving and connected cars, an effort she said will ensure the state is the go-to place for testing and producing vehicles of the future.

While speaking at the MICHAuto Summit in Detroit, Whitmer signed an executive directive to create the Michigan Office of Future Mobility and Electrification within the Department of Labor and Economic Opportunity, effectively immediately. It will be led by a chief mobility officer whose name probably will be announced in April, Whitmer said.

She also signed an executive order to establish the Michigan Council on Future Mobility and Electrification, an advisory group that will replace but function similarly to one created by a 2016 law. The council will be housed within the Department of Labor and Economic Opportunity instead of the Department of Transportation.

Whitmer told The Associated Press that business leaders told her administration it would be helpful to have one place of contact in state government for issues related to the mobility sector.

“Obviously that doesn’t mean that there won’t still be many departments involved. But there will be one quarterback,” she said in a phone interview. “That’s, I think, essential to ensuring that we’re harnessing all the great things we’re doing in a focused way that makes sense.”

While many states are competing to lead in mobility, Michigan is in a great position because it is home to the auto industry and has many engineers, top research universities and extensive “connected” infrastructure, Whitmer said.

Her directive cites six trends driving a period of “unprecedented change” in the auto industry and mobility sector: autonomous driving, vehicle connectivity, powertrain electrification, shared mobility, intelligent automation and the global supply chain.

The Democratic governor’s order creating the new advisory panel and putting it under a different agency will take effect April 27 unless it is rejected by the Republican-led Senate. The moves were welcomed by automakers, environmental groups and a major utility, Consumers Energy.

Whitmer signed the directive and order on the hood of a self-driving vehicle that has technology developed by Pittsburgh-based Argo Al. The company’s partner investors include Ford and Volkswagen.

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Michigan creates chief mobility officer, council focused on auto tech industry

February 25, 2020

Automotive News

By Chad Livengood

DETROIT — Gov. Gretchen Whitmer signed an executive order Tuesday creating a new Michigan Office of Future Mobility led by a chief mobility officer for the state focused on strategies to build up the automotive mobility tech sector.
Whitmer signed the directive on the hood of a Ford Motor Co. autonomous vehicle at a MICHAuto Summit in Detroit with auto industry leaders.
The Democratic governor also signed a second executive order establishing a Michigan Council on Future Mobility and Electrification.
The Office of Future Mobility will be housed within the state’s Department of Labor and Economic Opportunity.
The chief mobility officer, their office and the new council will be focused on developing a talented workforce for developing artificial intelligence technologies for self-driving vehicles and “placing a greater emphasis on the importance of electrification and electric vehicle infrastructure and overall state strategy around mobility,” Whitmer said.

Whitmer announced the new mobility industry initiatives after detailing the major auto industry investments the Detroit 3 have launched in the past year: Fiat Chrysler Automobiles’ conversion of two east side Detroit engine plants into a new Jeep assembly plant; Ford Motor Co.’s plans to build a fully electric F-150 pickup in Dearborn; General Motors’ retooling of its Detroit-Hamtramck plant to build electric vehicles, including a revived Hummer SUV.
“We are going to continue moving forward to keep our foot on the gas,” Whitmer said.

“This is a double and triple down for our industry,” MICHAuto Executive Director Glenn Stevens said on stage at the one-day summit at the College of Creative Studies’ Taubman Center in Detroit’s New Center.
Jeff Donofrio, director of the state Department of Labor and Economic Opportunity, said he expects to fill the chief mobility officer position within “the next few weeks.”
“We’re looking for someone who understands the industry very well, understands the kind of north stars that we’re trying to drive toward, right, which is making sure we have a strong auto industry that’s able to pivot to the next generation of mobility,” Donofrio said.

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