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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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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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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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 landscape and provided insight into the steps necessary to affirm the state’s leadership among other emerging markets. 

Robinet explained that IHS Markit provides vehicle forecasts on powertrain electrification, autonomy, and mobility. As part of the advisory team, Robinet works with suppliers and original equipment manufacturers (OEMs) to help better understand what’s happening in the industry. 

Suppliers and manufacturers look at two different factors when it comes to growthRobinet said, specifying that they consider both the data monetization of autonomous and education content, along with how to drive more volume and establish new dealer networks. 

“Our business has long been driven [by] scale and that mantra continues today,” said Robinet. “When you’re designing new electrification or autonomous structures, it’s a lot easier to afford if the number you’re dividing it by is an awful lot bigger than your competitor.”  

Robinet also noted some longterm trends emerging including that while sports utilities or crossovers will remain close to 50% of the market, that growth is slowing. And pickup trucks have likely leveled out for now in terms of their share of the market. 

Michigan has remained strong over the last decade and the volumes are still quite strong, Robinet said.  

“You see that global OEMs are really refocusing their efforts on using existing powertrains, harnessing new levels of electrification, and looking for where the data is going to have value in the future.” 

Executive Director of MICHauto Glenn Stevens Jr. and host of “Autoline” John McElroy joined Robinet onstage to continue the discussion. 

The group talked about how the industry has changed, and where it is headed in the next decade. Leadership has shifted drastically in the last ten years, noted Stevens. 

“When it comes to issues that are important, for example, diversity and inclusion, it was mentioned that it either comes from the top and from the troops, or it doesn’t work and it’s not relevant and impactful,” said Stevens. 

McElroy directed the discussion to how the U.S. needs to be thinking about the importance of the automotive and mobility industry. We are competing against countries that have industrial policies that are taking jobs away from us, he explained 

“We’re going to have to do things that make sure it’s on more of a level playing field,” said McElroy. 

MICHauto Hosts Israeli and Korean Delegations During Detroit Visits

This month, MICHauto and fellow economic development organizations hosted two international delegations, whose visits to the Detroit region served to acquaint them with the robust automotive and mobility ecosystem it offers and connect them with local businesses and potential partners.

The Israeli Economic Mission, hosted by MICHauto, Michigan Israeli Business Accelerator, and PlanetM visited the Detroit Regional Chamber on Tuesday, Nov. 5 for a day of startup pitches and match meetings. Following a brief program, 12 Israeli startups had the opportunity to pitch their work to potential business partners. The rest of the day was filled with productive match meetings, connecting the startups with Michigan-based companies and resources. The featured startups included Alango, Aurora Labs, C2A, ContinUse Biometrics, Cybellum, EVchip, Fleetonomy, Hi Auto, Jungo, Ottopia, Saemode, and CipherSIP.

The Korean SIDA and Hebron Star Automotive Manufacturers Detroit Delegation participated in presentations and tours led by the Detroit Regional Partnership, MICHauto, and PlanetM on Wednesday, Nov. 5. Glenn Stevens Jr., executive director of MICHauto and vice president of automotive and mobility initiatives for the Detroit Regional Chamber, gave a presentation on the past, present, and future of the automotive and mobility industry to the group of Korean automotive executives. The delegation also visited the PlanetM Landing Zone for a tour and networking lunch to learn more about the support the Detroit region offers to companies seeking to partake in the industry’s growth here.

Delegation visits like these continue to highlight the state’s notoriety as a leader in the automotive and mobility industry and gather the regional partners bolstering that growth.

MICHauto Investors Gather in Lansing for Annual Meetings with Legislators

“Meeting with legislators is crucial to ensuring that policymakers understand the industry’s issues, opportunities, and our collective economic impact,” said Glenn Stevens, executive director of MICHauto and vice president of automotive and mobility initiatives for the Detroit Regional Chamber.

On Tuesday, April 16, the Chamber’s MICHauto initiative gathered executives from 25 automotive companies to meet with 25 legislators in Lansing for the 2019 Automobility Day at the Capitol. Automotive experts and executives discussed the industry’s impact with legislators including MICHauto’s 2019 policy priorities. This year’s priorities focus on the further development of talent, technology, and trade as the key drivers of progress.

“The MICHauto policy priorities were created with the automotive industry and represent their thoughts on what we need to focus on to ensure future economic success,” Stevens said.

MICHauto values the opportunity to foster collaboration between industry leaders and the state government, which will ultimately strengthen Michigan’s economy and reinforce its standing as the automotive capital of the world. Many individuals contribute to this shared effort, and each year MICHauto recognizes one of them for their commitment to supporting the automotive and mobility industry in Michigan.

This year, MICHauto named Rep. Rebekah Warren Legislator of the Year for her dedication to driving next-generation vehicle R&D, her sponsorship and creation of the framework to allow the establishment of the American Center for Mobility, and her appointment on the Michigan Council on Future Mobility.

The sixth annual Automobility Day at the Capitol highlighted how a strong partnership with Michigan’s political leadership will continue to promote a promising future for the state’s automotive and mobility industry.