Several automotive suppliers on Tuesday announced expansion plans in Michigan in response to increasing demand for electric vehicle components following approval of taxpayer-funded incentives from the Michigan Economic Development Corp.
Lear Corp. will receive more than $6.413 million in incentives for a total of more than $112 million in investments for a new plant in Oakland County’s Independence Township, updates in Sterling Heights and an expansion in Traverse City, according to an MEDC briefing memo. The projects will create up to 500 jobs.
Meanwhile, the Economic Development Alliance of St. Clair County will receive a $3.6 million grant for infrastructure improvements in connection to an almost $427 million expansion at Magna International Inc.’s electric vehicle structures facility in St. Clair. The expansion will create 920 jobs.
And the Michigan Strategic Fund board approved nearly $1.644 million in incentives to Underwriters Laboratories Inc. for a new $72.7 million testing facility in Auburn Hills to support battery manufacturers in safety and reliability. It will employ 61 new jobs.
The investments are a sign of Michigan’s continued ability to compete for investments in the new era of zero-emission mobility as other states, particularly in the South, seek to attract auto investments with ready-to-build land, low costs of business and generous incentive packages. Such investments will create new jobs, though fears from the United Auto Workers abound that because EVs have fewer parts, some workers will be left behind. Automotive executives say they are taking steps so that’s not the case.
Mayville Engineering Co. Inc. also put forward a request to the MEDC, one that reduces an award granted last year to $1.776 million from $2.5 million because of uncertainty around its heavy- and medium-duty commercial vehicle, construction, powersport and agricultural markets. It’s scaling back production levels and has revised hiring plans in Hazel Park. The grant’s job requirements also fall to 275 new jobs from 287 and 338 base jobs from 398. Several milestone deadlines also were extended.
Lear chooses Michigan over Mexico, Texas
Lear, because of customer timing, has found a facility in Independence to manufacture battery disconnect units and interconnect cells boards. These subsystems control power transfer from the vehicle’s battery to its electrical systems, and together, they help EVs to charge faster and drive farther. The facility is 120,000 square foot. More than half — 52% — of it will be used for production. Another 36% will be for warehousing, and labs, testing space and offices will make up the last 12%.
The Traverse City expansion would would be for parts related to the EV battery pack, including busbars, battery interface and battery module components, to support the Independence operation. Sterling Heights also would increase production of engineered plastics for the subs-systems.
The incentives break down to a $4.5 million Michigan Business Development Program grant and a 15-year, 100% State Essential Services Assessment exemption estimated to be $1,913,275 for the $84.1 million eligible personal property the investment includes.
Because of the competitive nature of the project, the MEDC granted the Southfield-based company waivers because the project isn’t in an eligible distressed area or larger than $100 million. Lear also considered its existing facilities in Mexico and Texas, according to the MEDC memo.
The average wage for the jobs created by the projects is $20.30 per hour. Lear is prepared to train workers for the new roles, citing Michigan’s skilled labor force as a reason for the investment in the state, according to the memo.
Magna secures another contract
Magna has secured a contract to supply battery frames for electric propulsion vehicles assembled in the Midwest, according to an MEDC memo. The company is expanding its $70.1 million, 372,000-square-foot plant approved last year in St, Clair by 740,000 square feet.
The county economic development will use the Michigan Strategic Fund performance-based grant for a $7.45 million investment to construct a water tower, booster station and piping to the tower. Additionally, it’ll support $8.2 million in updates to the municipal water plant.
Positions at the Magna plant range from production to engineering to maintenance. Wages will start at more than $19 per hour and go up to more than $62 per hour depending on the role. The average wage of the new positions is $29 per hour. Magna has training and mentorship programs.
Underwriters Laboratories comes to Oakland County
Underwriters Laboratories is based in Illinois and does testing, inspection and certification services with software. It will purchase up to 20 acres of industrial property to build an 89,000-square-foot testing facility.
The incentives break down to a $1 million Michigan Business Development Program, a $500,000 Jobs Ready Michigan Program grant and a 50% alternative SESA for up to five years valued at $143,760 for the $37.2 million eligible personal property investment.
UL employs 90 Michigan residents. At the Auburn Hills facility, the average wage will be $1,573 per week plus benefits.
bnoble@detroitnews.com
Twitter: @BreanaCNoble