North American Auto Industry Review -- Site Selection magazine, January 2001

Suppliers, R&D Shops
Drive Auto Industry's Geography (cover)

Michigan Takes
Nothing For Granted

Design Collaboration
Drives Site Choices

New Facility
Requirements Take Shape

Apparent Edge
for Michigan

GM: In Step
with Site Trends

Design Center Gets
New Lease on Life

Southern Sites
Set to Expand

Honda Site 'More
than a Factory'

Toyota Plans Major
Capacity Gains

Hoosier State Touts
Major Projects

Suppliers Weigh in
With Expansions

UK Automakers Pond On
Non-Euro Status

Request Information

S I T E S E L E C T I O N S P E C I A L F E A T U R E F R O M J A N U A R Y 2 0 0 1

Michigan Takes
Nothing For Granted

Manufacturing investment, however, continues to concentrate in familiar turf, with plants both opening and expanding in Michigan, Indiana and a number of southern states.

Tom Livernois, executive director of AGC America

One factor increasing Michigan's appeal to companies' research efforts is the state's high-tech encouragement program, the Michigan Economic Growth Authority (MEGA), which granted its first set of tax credits to AGC America, totaling $3 million over 20 years. AGC America will develop electronic products for automotive windows, and research and analyze materials and glazing compounds for the automotive industry, as well as integrate new technical information into automotive window products. "Michigan helped us," says Livernois.

This concerted effort on the part of the state is refueling interest among automotive companies with facilities in Ohio and the south. "We want to grow the high-tech side of automotive research and development with MEGA," explains Jennifer Kopp, a spokeswoman for the Michigan Economic Development Corp. "Of 500 research and development facilities in the nation, 360 are in Michigan, with automotive a huge portion of those. We're building on our traditional strengths."

But the main motivation for AGC America in selecting Michigan, according to Executive Director Livernois, is simply that tier one suppliers must put their research and development facilities "close to the decision-makers and technical centers of the Big Three." Says Livernois, "Most of the engineering brains are in the Detroit area."

Dennis Virag, president of The Automotive Consulting Group, Ann Arbor, Mich., has been following the march on Detroit of dozens of tier one research facilities. The concept of collaborative engineering, in which vastly more design work is farmed out to suppliers than was traditionally outsourced, is driving this activity. "In the past, these companies had their re-search and development at their headquarters, or wherever their operations were," says Virag. "Now, since the car makers' engineering efforts are all being done in the Detroit area, the entire supplier development team had better be there too," he explains. "If there's a problem, the auto maker wants you there in 30 minutes. The auto makers are telling their suppliers they have to move their technical centers."

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