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Big 3 to invest $2B in Michigan

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Big 3 to invest $2B in Michigan

State incentives to help Ford, GM, Chrysler create thousands of jobs

Alisa Priddle and David Shepardson / The Detroit News

General Motors Co., Ford Motor Co. and Chrysler Group LLC plan to invest $2 billion in their Michigan operations, adding as many as 2,250 jobs and retaining thousands more.

The investments are due in part to tax incentives from the Michigan Economic Development Corp. The agency is to announce them — the largest approved in a single day — today.

Ford was first to outline its plans Monday. The Dearborn-based automaker said it will pump $850 million into four Michigan plants from 2011-13, adding 1,200 jobs to make six-speed transmissions, gears and other components to improve the fuel efficiency of its vehicles.

The affected Ford plants are Van Dyke Transmission in Sterling Heights, Livonia Transmission, Sterling Axle and Dearborn Truck.

Of the 1,200 Ford jobs, 300 are additional salaried engineers. The 900 hourly positions will not all be new hires: About 190 Ford workers are awaiting recall, and some jobs could be filled by workers who transfer from other plants that are overstaffed.

The new hires will come in at the second-tier $14-an-hour rate, said Mark Fields, Ford president of the Americas.

The United Auto Workers union, as part of industry restructuring, agreed that new workers would paid half as much as veteran employees.

Chrysler was to announce today its plans to invest $1 billion for equipment and tooling to make midsize cars at the Sterling Heights Assembly Plant and increase production of four-cylinder engines, including a new Fiat-derived 1.4-liter, at the Global Engine Manufacturing Alliance plant in Dundee.

No new jobs are being announced now, but a second shift of 900 workers is expected to be added in Sterling Heights next spring, if demand requires more workers to build the 2011 Chrysler 200, which replaces the Sebring, and the Dodge Avenger.

GM is expected to announce a $152 million investment in Michigan, including $112 million at the Warren Technical Center for hybrid and electric vehicle programs, adding up to 900 jobs, said a source familiar with the plans.

GM also will invest $40 million at its Brownstown Township plant that assembles battery packs for the Chevrolet Volt, adding 150 jobs.

The American automakers aren't the only ones in line for state incentives.

The MEDC is reviewing a request from Hyundai Motor Co., working with DTE Energy, to upgrade the electric power infrastructure in Superior Township, where Hyundai has its America Technical Center.

Big costs, big rewards

Gov. Jennifer Granholm said this will be the largest MEGA grant day in the agency's history, in dollars and in the number of jobs created and retained.

In many cases, she said, Michigan was competing with other states and countries. Ohio, for example, was courting Ford.

Ford's tax incentives are worth $415 million over 15 years — but they replace three prior MEGA grants. The new umbrella amount represents a net gain of $200 million, Granholm said at the Ford Van Dyke plant in Sterling Heights on Monday.

The tax incentives, worth $1.3 billion for Chrysler over 20 years, are modeled after what the state gave GM for its Orion plant.

In June 2009, the MEGA board approved tax incentives for GM to build a new small car project at its Lake Orion plant and invest up to $700 million.

Breaks contingent on jobs

The board also approved a retention employment tax credit for 20 years for as many as 20,000 employees kept on the job at GM facilities throughout the state.

Granholm called the Sterling Heights Chrysler plant "the second Lazarus plant that we've been able to save."

GM's new state incentives amend an earlier award to add hybrid and electric vehicle battery and vehicle engineering and development at the Tech Center. The projects could bring additional jobs, according to a source familiar with the situation.

The incentives are contingent on creating promised jobs.

"Investing in American manufacturing is a priority for Ford," Fields said. The investment, he said, will contribute to a "broad range of more fuel-efficient vehicles."

Every vehicle in the Ford lineup will have a six-speed transmission by 2013, Fields said. "We want to ensure Michigan remains the epicenter of today's and tomorrow's high-tech auto industry," Fields said.

Added U.S. Rep. John Dingell: "We know this is an industry worth fighting for."

And Granholm said the combined effect "means the auto industry is back."

From The Detroit News: http://www.detnews.com/article/20101026/AUTO01/10260323/1148/Big-3-to-invest-$2B-in-Michigan#ixzz13TD2KMUW

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GENERAL MOTORS, CHRYSLER TO JOIN FORD IN MAJOR MICHIGAN INVESTMENTS

By Mark Kleis

On Monday, Ford’s president of the America’s, Mark Fields, joined Michigan Governor Jennifer Granholm to announce that the automaker and the state of Michigan planned to introduce special tax cuts that would help create much needed jobs in the state.

Fields went on to introduce Ford’s plan that called for an $850 million investment within the state’s borders, and plans to add up to 1,200 jobs over three years.

Today, General Motors and Chrysler join Ford in their commitment to the state, and also benefit from a commitment from the state.

Chrysler vows major investment

Chrysler will be announcing a $1 billion investment, to be spent largely on equipment and tooling for midsize car production at the Sterling Heights Assembly Plant, according to The Detroit News.

Chrysler will also increase production of its Fiat-sourced 1.4-liter engine, produced in Dundee, Michigan, at the Global Engine Manufacturing Alliance plant. Chrysler did not have any new jobs associated with its investment to announce at this time.

GM plans smaller investment, bigger jobs creation

Although GM’s plan – to be formally announced later today – will only call for a $152 million investment within Michigan, the automaker will use $112 million those funds at its Warren Technical Center, which could result in as many as 900 new jobs, according to a source speaking to DetNews.

The other $40 million is to be allocated to the Brownstown Township plant, responsible for producing the all-important Volt battery pack. The second investment is expected to create 150 jobs.

Hyundai requests tax breaks as well

Not to be left out, Hyundai has also requested tax breaks from the state, citing plans to work with DTE Energy on a project aimed at upgrading the power infrastructure in Superior Township. Hyundai operates a facility in that region known as the America Technical Center.

The DetNews also outlined both the benefits to the automaker from the state, and the benefits to the state from the automakers. Ford is set to save $415 million in taxes over 15 years, which includes the replacement of three prior MEGA grants. In return, Michigan will make $200 million from the automaker in increased tax revenue.

Chrysler is the recipient of a major tax break, valued at $1.3 billion over 20 years. Chrysler’s deal was similar in structure to the deal given to GM by the state for the Orion plant.

All tax breaks are contingent on automaker creating new jobs outlined in their plans.

link:

http://www.leftlanenews.com/general-motors-chrysler-to-join-ford-in-major-michigan-investments.html

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Chrysler, Ford lead tax breaks

A credit for GM hybrid-electric vehicle battery site is expanded

By CHRIS CHRISTOFF

Lansing Bureau Chief

LANSING -- Major tax credits for Ford and Chrysler head the list of 17 projects approved Tuesday for tax breaks in southeast and west Michigan by the Michigan Economic Growth Authority (MEGA).

The MEGA board also expanded an earlier tax credit granted to General Motors for a new hybrid-electric vehicle battery center at the Warren Technical Center. An additional 900 jobs would become eligible for state tax credits.

Also, GM will receive an additional tax credit worth $25million to employ 4,000 people at its Renaissance Center headquarters. In all, GM was granted a potential $757 million in additional tax credits based on keeping 30,000 employees in Michigan.

Ford was granted a 15-year state tax credit worth $909 million, of which almost half -- $414 million -- is for its plan to invest $850 million in various plants, including the Van Dyke Transmission in Sterling Heights, where 900 workers will be added for a second shift.

The tax credit is tied to Ford retaining 28,000 jobs directly.

Chrysler will receive a tax credit worth $1.3 billion over 20 years for several projects, including $850 million in a body shop upgrade and new paint shop at its Sterling Heights assembly plant where more than 900 people are to begin working on a second shift next February.

The Auburn Hills automaker also will spend an additional $150million at its Dundee engine plant to expand capacity for Fiat-designed four-cylinder engines. That is in addition to a $179-million upgrade announced last December to produce the Fiat-designed MultiAir 1.4-liter engines for the subcompact Fiat 500, to be built at Chrysler's Toluca, Mexico, plant.

The Chrysler tax credits are aimed at retaining 20,000 workers directly employed by the company.

Gov. Jennifer Granholm said it was the MEGA board's biggest single day in announced jobs either created or retained as a result of targeted tax credits.

"Today really seals that Michigan will remain the center of automotive manufacturing in the United States and around the globe," Granholm said in announcing the tax credits. "This is a day that commits General Motors, Chrysler and Ford to continuing to thrive in Michigan."

Granholm said the planned new investments by the automakers, and Ford's announced $1.7-billion third-quarter profit "signals a hugely positive trend for the auto industry and therefore for Michigan and those who will be employed in this sector."

The MEGA board also approved a tax credit of $11.1 million for GM Subsystems Manufacturing in Brownstown Township, which assembles battery packs for the Chevy Volt car. It calls for an investment of $39.7 million and 150 direct new jobs.

Read more: Chrysler, Ford lead tax breaks | freep.com | Detroit Free Press http://www.freep.com/article/20101027/BUSINESS01/10270401/1331/Chrysler-Ford-lead-tax-breaks#ixzz13Yy6VIFR

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Report: Detroit automakers pledge $2B investment after Michigan passes tax incentives

by Zach Bowman (RSS feed) on Oct 28th 2010 at 8:30AM

The Michigan Economic Growth Authority has approved a series of tax incentives for Ford and Chrysler and expanded previously approved incentives for General Motors. Between a tax break engineered to help GM build a 900-job electric-vehicle battery facility in Warren and another to keep 4,000 people at work in the company's Renaissance Center headquarters, The General is looking at a considerable stack of incentives. According to The Detroit Free Press, the company has been granted a total of $757 million in potential tax breaks that hinge on the automaker keeping a total of 30,000 people at work.

But that's a drop in the bucket compared to what Ford and Chrysler walked away with. Ford was given a 15-year, $909 million credit. As part of that deal, FoMoCo has to retain 28,000 workers. Around $414 million of that tax break is geared toward helping Ford pump $850 million in to a slew of plants spread around Michigan.

Chrysler, meanwhile, took the incentive cake. The smallest of the big three was awarded $1.3 billion in incentives over 20 years geared at keeping 20,000 people at work. The tax breaks surround everything from upgrades to the company's Sterling Heights facility to work required to prepare its Dundee facility to manufacture the Fiat 1.4-liter Multiair four-cylinder.

All told, the tax breaks will reportedly allow the big three to invest a combined $2 billion in their respective Michigan facilities.

LINK:

http://www.autoblog.com/2010/10/28/report-detroit-automakers-pledge-2b-investment-after-michigan/

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