Guide to Economic Development in the Global Auto Industry - S30

Greenfield or brown, the money rolls on
W

hen auto companies invest in new
plants, the public takes notice. New
factories mean new jobs and a boost in
economic activity in individual towns and
regions.
But turning raw ground into a new auto
plant is just one piece of the economic force of
automotive capital expenditure. Automotive
manufacturers, both carmakers and parts
suppliers, spend billions annually rebuilding
older plants, converting old lines into new
products, retooling factories and embracing
new capabilities - in addition to constructing
all-new factories.
The ongoing stream of investment often
comes as a surprise to the general public.
In a single month this year - March - the
United States saw 36 new projects announced,
representing a combined investment of more
than $1 billion and plans for 8,100 new jobs,
according to the Center for Automotive
Research's Book of Deals.
Of those 36 March projects, 20 will be
expansions of existing facilities, and two are
factory retooling projects. The other 14 are
planned new facilities.

project announced in January to build a
Toyota-Mazda joint venture assembly plant
in Huntsville, Ala. But second- or third-phase
plant expansions still have an impact, creating
new jobs or reaffirming existing jobs.
Volkswagen said in March it will invest
$340 million more in its Chattanooga, Tenn.,
assembly plant to put a new five-seat Atlas
crossover into U.S. production. That plant
opened seven years ago with an initial
investment of $1 billion. Two years ago, VW
committed another $900 million to expand
the site to begin producing the Atlas.
This year's investment did not promise new
jobs - it spoke instead of retaining jobs.
The added commitment also spurs supplier
spending. Approximately 5,600 auto parts
suppliers operate in the United States with
871,000 workers, according to the Motor
& Equipment Manufacturers Association.
Anytime an automaker invests in a product

BIG NUMBERS
The numbers add up fast.
Last year's report from the American
Automotive Policy Council, "The State of
the U.S. Auto Industry," calculated that
automakers alone have invested $50.3 billion
in their U.S. assembly plants, powertrain
factories, research labs and offices over the
past five years.
Few of those projects were greenfield
industrial projects, unlike the $1.6 billion

30

E C O N O M I C D E V E L O P M E N T G U I D E / J U LY 2 0 1 8

or a manufacturing plant, suppliers spend
correspondingly to keep up with the customer.

KEEPING UP
The Canadian supplier giant Magna
International said this year it will spend
$8 million to expand a seating plant in
Spartanburg, S.C., one of four sites it operates
in the state where BMW is a key customer.
BMW revealed last year that it will invest
another $600 million in its 23-year-old
Spartanburg assembly plant to upgrade its
manufacturing infrastructure and add 1,000
more jobs.
Magna's project might be small in
comparison. But the project will bring 130
new supplier jobs to Spartanburg. Job growth
is a driving motivation for cities, states
and nations around the world that funnel
government incentives to the industry to
foster it.

- lindsay chappell



Table of Contents for the Digital Edition of Guide to Economic Development in the Global Auto Industry

Guide to Economic Development in the Global Auto Industry - Intro
Guide to Economic Development in the Global Auto Industry - S1
Guide to Economic Development in the Global Auto Industry - S2
Guide to Economic Development in the Global Auto Industry - S3
Guide to Economic Development in the Global Auto Industry - S4
Guide to Economic Development in the Global Auto Industry - S5
Guide to Economic Development in the Global Auto Industry - S6
Guide to Economic Development in the Global Auto Industry - S7
Guide to Economic Development in the Global Auto Industry - S8
Guide to Economic Development in the Global Auto Industry - S9
Guide to Economic Development in the Global Auto Industry - S10
Guide to Economic Development in the Global Auto Industry - S11
Guide to Economic Development in the Global Auto Industry - S12
Guide to Economic Development in the Global Auto Industry - S13
Guide to Economic Development in the Global Auto Industry - S14
Guide to Economic Development in the Global Auto Industry - S15
Guide to Economic Development in the Global Auto Industry - S16
Guide to Economic Development in the Global Auto Industry - S17
Guide to Economic Development in the Global Auto Industry - S18
Guide to Economic Development in the Global Auto Industry - S19
Guide to Economic Development in the Global Auto Industry - S20
Guide to Economic Development in the Global Auto Industry - S21
Guide to Economic Development in the Global Auto Industry - S22
Guide to Economic Development in the Global Auto Industry - S23
Guide to Economic Development in the Global Auto Industry - S24
Guide to Economic Development in the Global Auto Industry - S25
Guide to Economic Development in the Global Auto Industry - S26
Guide to Economic Development in the Global Auto Industry - S27
Guide to Economic Development in the Global Auto Industry - S28
Guide to Economic Development in the Global Auto Industry - S29
Guide to Economic Development in the Global Auto Industry - S30
Guide to Economic Development in the Global Auto Industry - S31
Guide to Economic Development in the Global Auto Industry - S32
Guide to Economic Development in the Global Auto Industry - S33
Guide to Economic Development in the Global Auto Industry - S34
Guide to Economic Development in the Global Auto Industry - S35
Guide to Economic Development in the Global Auto Industry - S36
Guide to Economic Development in the Global Auto Industry - S37
Guide to Economic Development in the Global Auto Industry - S38
Guide to Economic Development in the Global Auto Industry - S39
Guide to Economic Development in the Global Auto Industry - S40
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