Motor city losing its appeal?

[Richard]

http://www.industryweek.com/expansio...plant-kentucky

Kentucky recently received another boost to its automotive industry with the announcement that iwis, a German automotive supplier, will locate its first U.S. plant in Murray, Kentucky.
The company becomes part of the 440 motor-vehicle related companies, which include four major auto assembly plants, that employ nearly 72,000 people across Kentucky.

They have a subsidiary called Kayser Automotive with an office in Troy,the foot was already in the door.

http://www.industryweek.com/industry...plant-kentucky

Asahi Bluegrass Forge is one of 150 facilities in Kentucky that are Japanese owned. Together these companies employ 34,000 across the state. Asahi Bluegrass Forge's parent company is Asahi Forge Corp., a Japanese company that specializes in producing such automotive parts as hub units, gears, transmission components, bearings and joints.

http://www.industryweek.com/articles...cky_23170.aspx

Shiloh Industries manufactures first-operation blanks, engineered welded blanks, complex stampings and modular assemblies for the automotive and heavy-truck industries. The company has 15 wholly owned subsidiaries at locations in Ohio, Georgia, Michigan, Tennessee, Mexico and now Kentucky and employs approximately 1,250 people.

There are a bunch more including non automotive related such as Whirlpool.

You would think that the suppliers would want to locate close to the big 3 to save on shipping but also the big three are expanding their presence in the bluegrass state.

Kinda like corps were not worried about the workers moving to the burbs because they could always move the business there.

I guess in picking the winners and losers realm of things the losers end up in Tennessee along with their investments,jobs and tax base.

[rb336]

Our dear governor doesn't believe in actively recruiting companies. I can't think of one major new company that announced it was coming to Michigan since he took office

[renf]

Is there any convincing quantitative evidence about what Michigan has or has
not accomplished in the last few year in recruiting firms? How does it
compare to other states? Do I recall that a subsidy of Peugeot established
a new firm in Detroit's Gateway Industrial Park to produce interiors for
Mustangs? Are there other examples of this state recently attracting
firms?

[maverick1]

Transplant manufacturers usually have their plants in the South and tech centers in the North or West. I think the West Coast and Northern states can't compete with the cheap land, cheap labor, and tax giveaways the Southern states offer.

[Richard]

Well in Michigan you have,

Ralco Industries invested $6.4 million in Pontiac,2.6 million in incentives.

I am not sure if they were an existing company or not.

Clyde Union Pumps invested $17.1 million to expand in Battle Creek instead of choosing the competing right-to-work states of Texas and Louisiana."

Mr Gilbert - 200 million unknown amount of jobs.

There are several high dollar warehousing projects going in outside of Troy in advance of the proposed new bridge including GE,but incentive packages have not been released to the public yet.

Then you have GE In 2009, GE announced that it would invest $100 million in its Michigan site, and that state officials had offered more than $60 million in incentives over the next twelve years.60/40 insane.

Before Mr. Snyder.

GE received $40 million in incentives to build a solar panel assembly facility in Ann Arbor to employ 200.

With Mr. Snyder.

Michigan actually paid higher incentives to employ less.

The difference between a assembly line worker in Birmingham Alabama and Detroit when cost of living is factored in down to the bar of soap on the bathroom sink is $800. and change.

I think a lot of it boils down to attitude,when everything started crashing it was announced that the goal was retention of existing businesses to prevent future losses,and a trip to China to lure.

While you were sleeping.

What is Tennessee doing different?

They have a state representative living in Germany.
They have a state representative living in Japan.
Etc. etc.

Their incentives are at or below the norm.

Right to work or not there are limited benefits when comparing North and South as everything is relevant.

So you have Michigan giving higher incentives offering the same standards and also has the hometown advantage as most of these companies already have at the very least an office already located in the state.

Tennessee has mild climate but subject to tornado's,Michigan has cold and snow but also because of its location is not subject to the wrath of mother nature as much as the more Southern states,as a hurricane can cause a company millions in shut downs and damages,so that aspect in its own is a part of the process.

Incentives for jobs usually require those jobs to be a % above the medium poverty level.

Maybe it does boil down to attitude and being a little more outsider friendly at the state level.

[Hypestyles]

..... and the anti-unionist rhetoric.

[old guy]

Transplant manufacturers usually have their plants in the South and tech centers in the North or West. I think the West Coast and Northern states can't compete with the cheap land, cheap labor, and tax giveaways the Southern states offer.

I'd have to agree with that. It's hard to understand why Detroit/ Michigan wouldn't offer better tax incentives, etc. to attract more companies. If you had a full house, I could understand it. Expand the tax base by having more people working, even if you're giving a corporation a sweet deal to set up shop in your state. Times are tough everywhere, not just in Detroit. Competition isn't going to take a back seat to how much people want to see Detroit succeed. And believe it or not, people do want to see the city succeed.

[DetroitPlanner]

Don't think so. Still a lot going on here:
http://www.huffingtonpost.com/2013/0...n_3720078.html

Top car colleges are here:
http://www.edmunds.com/car-reviews/t...in-the-us.html

This does not include specialty schools such as CCS or Northwood.

Toyota does a lot here even if it has no manufacturing,
http://www.toyota.com/about/our_busi...d_development/

Isuzu designs and builds here as well:
http://www.macraesbluebook.com/searc...company=664926
http://globenewswire.com/news-releas...ne-Trucks.html

Yes we don't have 100 percent of the market but we never did. We used to have more but when you think of competing against Korea and Mexico's wages its astounding we have what we have.

[LeannaM]

Transplant manufacturers usually have their plants in the South and tech centers in the North or West. I think the West Coast and Northern states can't compete with the cheap land, cheap labor, and tax giveaways the Southern states offer.

Sounds pretty accurate to me. I'm not sure about the incentives, but Kentucky probably does have cheaper land overall and lower cost of living. I would assume Kentucky has lower taxes, but I'm not certain on that. As far as tornadoes, they don't happen that often outside of tornado alley. In Tennessee and Kentucky you have tornadoes occasionally, but I wouldn't think those would be a major factor. Plus, I would assume most companies have insurance. I think flooding is more of an issue in those states than tornadoes are. Just my two cents on it, though.

[Baselinepunk]

"I'd have to agree with that. It's hard to understand why Detroit/ Michigan wouldn't offer better tax incentives, etc. to attract more companies."


Are you serious!?!?

Have you not heard of the massive tax give aways 'shift at the sake of everyone else that has occurred under Snyder? Are you agreeing that this coporate welfare doesn't work in a State with so many bankrupt / failing cities?

Will you be joining me in calling Dick's office and tell him enough of this corporate welfare BS when cites are failing on his watch?

Hold Snyder accountable!!



Seriously, some people's children ......

[old guy]

"I'd have to agree with that. It's hard to understand why Detroit/ Michigan wouldn't offer better tax incentives, etc. to attract more companies."


Are you serious!?!?

Have you not heard of the massive tax give aways 'shift at the sake of everyone else that has occurred under Snyder? Are you agreeing that this coporate welfare doesn't work in a State with so many bankrupt / failing cities?

Will you be joining me in calling Dick's office and tell him enough of this corporate welfare BS when cites are failing on his watch?

Hold Snyder accountable!!

Seriously, some people's children ......

Yes I am serious.

I don't understand the question you're posing. It almost sounds as though you're arguing with yourself. Possibly I'm misinterpreting your statement. Possibly I'm stupid, obviously someone's child, simply stating my point of view.

Will you be joining me in calling Dick's office and tell him enough of this corporate welfare BS when cites are failing on his watch?

Probably not.

[illwill]

I'm sort of glad this topic was brought up because it's been on my mind for quite a while. I do feel like the big 3 has slighted southeast Michigan and Detroit in particular. I know the State is doing pretty good economically but I wish more the Industry would reinvest in the city 10-fold. Kentucky may be affordable but land doesn't get much cheaper than Detroit. Also, Michigan has everything to offer except a thriving big city. When the media says Detroit is booming [[referring to the Big 3), people get the wrong impression of the city. The burbs are booming but Detroit still has the flu. People are confused. Because everyone uses Detroit's name but in reality, the industry is almost non-existent in the city.

The auto industry ALONE could change the city and its viability. The auto industry & suppliers are on fire right now, making record profits and expanding operations. However, they're following the sprawl and expanding to Troy, Milford and other ritzy suburbs as far away from Detroit as possible.

I don't feel a personal connection to the big 3 because I think they can care less about Detroiter's. Maybe I'm over thinking, however I feel they should bring industry back to the inner-city of Detroit if they want my loyalty. My guess is if Duggan becomes Mayor, you'll see a SHIT LOAD of suburban based businesses [[corporate & manufacturing) return to the city. If Benny wins, it'll be the same old song. Yes, I think race relations plays a major part in all of this.

Full disclosure... I do drive a Jeep Grand Cherokee but I wouldn't be opposed to buying a foreign vehicle.

[DTWflyer]

Saying that the Motor City or the State of Michigan didn't do enough to attract these new/expanded business is really a simplistic assumption that is far from reality. In many cases, its just does not make sense to locate in Michigan.

For half a century, the automotive industry has extended well beyond Michigan. Michigan, Ohio, Indiana, Kentucky, Tennessee, Illinois, Missouri, and Ontario all are the primary areas that fall within the geographic area of the auto industry.

Ford has been building trucks in Kentucky for 80+ years.

Suppliers are naturally going to cluster around and near assembly plants and build components for the programs that are produced from the OEM assembly plants.

No one owes anything to locate all automotive jobs in/around Metro Detroit. The reality is that almost no one is adding new square footage, they are just increasing capacity within their existing manufacturing footprint.

[RickBeall]

Maybe they are trying to avoid the tentacles of the unions.

[ndavies]

Let's also not forget the low energy prices in the south. Kentucky and Tennessee have the TVA dams providing the electricity. In Kentucky the pay 5.42 cents per KWH for industrial electricity. We pay 8.17 cents per KWH. Manufacturing plants use huge amounts of electricity. It's one of the reasons why we see research centers in Michigan and manufacturing plants in the south. Electricity rates: http://www.eia.gov/electricity/month...m?t=epmt_5_6_a