Business Facilities - December 2007 - (Page 19)

The Nation’s Automotive Capital Wins $1.73 Billion in New Chrysler Investments Project Title: Michigan’s Big Deal With Chrysler Entered By: Michigan Economic Development Corporation L ike the Silver Award, the 2007 Bronze Award goes to a state that secured a sizable automotive investment—this time in a location that gets more press for its woes than its successes. That state is Michigan, and this year’s Bronze Award goes to the Michigan Economic Development Corporation for its efforts (along with several local communities) to secure a $1.73 billion investment from Chrysler. The automaker is investing $730 million to replace its aging engine plant in the Downriver Detroit community of Trenton, MI; $700 million to build a new axle plant in Marysville, MI; and the remaining $300 million to expand a paint shop at its Sterling Heights, MI assembly plant, just outside of metro Detroit. Michigan had competition for the Trenton plant from Indiana, Ohio, and Mexico, but thanks in part to a state tax credit valued at over $11.2 million spread out over nine years Chrysler LLC’ s Engine Plan proposed design for th e Phoenix t in Trenton, MI. from the Michigan Economic Development Corporation, Chrysler was persuaded to stay in its home state. The company agreed to make the other two investments as part of the incentive agreement. “I was particularly impressed with Michigan’s aggressive approach to securing the investments through its generous combination of incentives and business support programs,” says Economic Development Deal of the Year Award judge Stuart MacKay, president, MMK Consulting. “Michigan’s approach is clear evidence of this state’s willingness to compete with Southeastern U.S. states for auto plant investment.” Ground was broken in May on the site of the future Trenton Phoenix Engine Plant, which will replace the existing Trenton plant. The old plant opened in 1952 and is scheduled to close in 2015; its buildings will be used as warehouses by Chrysler, and many of the old plant’s 1,200 employees will be transferred to the new plant. This new 822,000-squarefoot facility, which will be used to produce a new family of fuel-efficient engines, will employ 485 fulltime workers. On top of the incentives offered by the state, the Trenton community also contributed to the effort to secure the Chrysler investment by offering a form of local tax abatements worth $66.9 million over 12 years. Trenton Mayor Gerald Brown says the city, as an economically distressed area, was able to offer Chrysler sweeping tax abatements. “I was impressed with the creativity of Trenton Mayor Gerald Brown and his team for generating a very aggressive incentives package for Chrysler that translated into high-paying jobs for an economically distressed community,” says Frank Sherwood, vice president, Staubach Corporate Services. “His efforts created much needed jobs with an average wage of over $1,000 per week.” Chrysler also broke ground in May for the 750,000-square-foot Marysville plant. The company was interested in a site in the adjoining St. Clair Township, but the township was unable to offer the personal property tax abatement needed. In the spirit of cooperation, Marysville agreed to a friendly annexation of the 211-acre St. Clair Township site in order to satisfy Chrysler’s need. This agreement allows both areas to share tax revenue resulting from the project. Marysville will buy the property and will provide for the plant’s water and sewer requirements. PROJECT IMPACT ESTIMATES $183 million in additional state revenue as a direct result of the project 1,242 direct jobs created and 3,649 indirect jobs Over $2.5 billion in direct wages Capital investment: $1.3 billion Impact area modeled: State of Michigan, eight-year time frame IMAGE PROVIDED BY CHRYSLER LLC BUSINESS FACILITIES 19

Table of Contents Feed for the Digital Edition of Business Facilities - December 2007

Business Facilities - December 2007 Contents First Word Snapshots Metro Spotlight: Albuquerque, New Mexico Corporate Moves: North Carolina 2007 Ecomonic Development Deal of the Year Awards State of the Year Seeking Supply Chain Solutions Mississippi Means Business Corporate Moves: South Carolina Biomedical Momentum in Florida's High Tech Corridor Trends in Offshoring Metro Spotlight: Stillwater, OK Metro Spotlight: Atlanta, GA Advertiser Information 2007 Salary Survey

Business Facilities - December 2007

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