n an Eastern Indiana town not far from where Honda chose to site its own car plant a few years ago, Carbon Motors Corp. has chosen to build a new US$350-million, 1,300-job plant for the manufacture of police vehicles in a shuttered 1.8-million-sq.-ft. (167,220-sq.-m.) Visteon plant. Just up the road in Michigan, General Electric will locate a new Advanced Manufacturing and Software Technology Center that will house some 1,100 jobs at the Visteon Village site in Van Buren Township, where Visteon, currently working through Chapter 11 bankruptcy, will continue to operate its corporate offices and innovation center.
“Visteon today is a smaller, leaner company than when we moved into the Village in 2004,” says Visteon spokesman Jim Fisher. “We previously had close to 3,000 employees supporting Visteon at the Village, and today we have about 1,500. After consolidating employees at the Village, we had available space at the Village, which we began marketing in August 2008 through our real estate advisory firm. Our goal was to find a suitable tenant, which we certainly did in GE.”
Fisher says the company will have private, controlled access to its offices and work spaces, and employees at both companies will share access to certain common areas such as the cafeteria, document resource center and nature trail.
“We believe having this highly reputable tenant on site will be mutually beneficial to Visteon and GE, and will benefit the Southeast Michigan region as well,” he says. “We continue to market remaining available space at the Village.”
Connersville, Ind., beat out finalist sites outside Atlanta and in the Greenville-Spartanburg, S.C., metro area for the plant from Carbon Motors, whose leaders have kept the public abreast of the entire site selection process via blog since spring 2008. That’s the same medium the company has used to get out the word about its Carbon E7 vehicle, a 300-horsepower, fuel-efficient, specially outfitted car that has been tested by first responders across the nation. The company will seek federal funding support from several different agencies, including Homeland Security. Law enforcement agencies have placed orders now numbering over 10,000 for the vehicle.
A look at the blog reveals a team that seemed to enjoy being pursued, as company leaders played up the suspense and offered details of the courting process. William Santana Li, president and CEO, and Alan J. Bratt, executive vice president and chief production officer, led the selection process, backed by their small but high-powered team, many of whom have decades of experience at Ford Motor Co. Li and Bratt themselves have helped establish plants from Brazil to the Asia Pacific, in addition to driving strategic and joint-venture initiatives.
So, why blog about what is usually a top-secret, code-named process?
“Given the product we’re developing, given it will be taxpayer dollars at work from almost every angle, in this day and age of transparency I thought it would be a good idea to have all the communities involved,” says Li in an interview from the company’s Atlanta offices. “Second, and also important, we’re not a large running concern, like the large industrial conglomerates, that issues RFPs through intermediaries. It was an important way for the community to get involved, hold elected and appointed officials to account and make sure everyone got a fair shake. I got a few calls from a few states, who said ‘You’re doing this publicly, and this is causing us a lot of heartburn.’ I said if everyone is doing their jobs and have nothing to hide, it’s all good.”
Li’s team looked at more than 400 criteria, and considered the greenfield option as well. He says his team was “flattered” to have five states send proposals, including a late entry from North Carolina and another from Michigan.
“An industrial and automotive supply base is important, and access to major international airports is key for customers, the team and suppliers,” says Li. “Probably one of the most important was to have the local authorities at city and county level work closely with state and congressional delegations and federal authorities. Finding that mix is very difficult.”
That’s where it helps to have a leader such as Indiana Gov. Mitch Daniels, whom Li describes as “effectively the chief economic development officer” for the state. In addition to Daniels’ federal government experience as head of the White House’s Office of Management and Budget, he’s also someone who knows how fast bloggers like to get feedback.
“There were close to a dozen back-and-forth discussions with him directly,” says Li. “Every single time my voicemail or e-mails got replied to within 35 minutes. Last night was a Sunday and it was an hour. He is engaged and tremendously competent.”
The Indiana Economic Development Corp. (IEDC) said it “must resolve outstanding contingencies with the company before agreements are finalized, including site acquisition complexity brought about by Visteon’s recent bankruptcy, latent environmental concerns at the vacant facility and finalizing terms of an agreement which will protect Hoosier taxpayers and give Carbon Motors the opportunity to effectively compete for federal funding.”
“They came to us during the early days of the stimulus discussion, back in February before the bill had actually passed,” says E. Mitchell Roob, Jr., secretary of commerce for the State of Indiana and CEO of IEDC. “They asked for a building that had some re-use opportunities, wanted a work force used to manufacturing, and were looking for a facility that had good Interstate access. And they were looking for some degree of incentives.”
Roob (pronounced “robe”) says the state hopes to resolve the environmental issues by September. They were issues waiting to be addressed whether Carbon was coming or not, he says.
“The Visteon plant is a relatively old plant, and is on the site of an even older plant,” he says. “Anytime you’ve been doing industrial manufacturing for over 60 years, you’re going to find some degree of environmental remediation necessary. It’s not terribly serious, but to meet current standards, it needs to be addressed.
Visteon closed the facility in December 2007, and then put it on the market for sale. Visteon’s Fisher notes that, because Visteon is in Chapter 11, court approval of any agreement involving the vacant facility would likely be required. “We hope to reach an agreement that benefits the Connersville community, a potential buyer and Visteon,” he says.
Roob notes that although the supplier network in the vicinity of the new Honda plant has grown more dense in the past two years, the state already had a robust supplier network, thanks to ongoing operations in the state from Toyota, Subaru, Chrysler and GM. Over and above that, he says, “We’re good at making things, and people around the country and the world know that.”
Li says a few locations would have worked out fine from a technical perspective, but “I knew in my heart of hearts that once we announced the deal, we would have been on our own. That’s not a sustainable long-term strategy.”
Nor were the company’s previous locations.
“I formed the company in California in 2003,” explains Li. “We did a bit of searching around California to find the right location and right political circumstances, but it was not working there, so we looked around the Southeast, which was more technically correct in terms of supply base, the transplants here and the like. We came here in good faith, but came to a point where we weren’t making much headway. So we started looking elsewhere.”
As the decision drew near, Li blogged that his team needed “a few little miracles” to happen. Asked about which had come to pass, he still can’t get over the non-technical and very overwhelming display he witnessed in Connersville during what promised to be a routine and quick site visit. He calls the entire day “surreal.”
“Mayor [Leonard] Urban from Connersville came down to visit with us in Atlanta,” recounts Li. “It was a good meeting, and he said, ‘All I ask is, before you make a decision, you come and visit.’ I thought we were going to get on a plane, see the site, have a bite to eat, get back on the plane and go home. We arrived at the airport, and there were gentlemen in nicely done black embroidered Carbon Motors shirts we don’t even have. There was a police escort. As we were a rriving n town, we wondered why all the people were having car trouble. They were waiting for the motorcade to go by. Every single sign in town had been changed to welcome Carbon Motors, and 7,300 people greeted us at the site, with 100-ft. flags waving.”
Flag presentations, marching bands and a boys choir ensued, as people stood in line for hours to greet the Carbon Motors team and walk around the car, hundreds of them wearing special “Carbon Motors Connersville” t-shirts. Dinner featured soup decorated with the company logo. Welcome letters greeted the party in their hotel rooms. The next day, a visit to an elementary school revealed a red construction-paper carpet signed by all 350 children, who had also covered the walls with their career development assignments on the history of police cars. Then came another police escort back to Indianapolis, where Gov. Daniels met the team. After walking around the car in the rain, “we sat around the table in his office and started the discussions,” says Li. Not-so-formal follow-ups included a shipment of cookies with the Carbon Motors logo, a chocolate Indy car and a copy of the book “Off the Beaten Path,” a compendium about unique travel destinations.
After the announcement, dozens of Connersville residents blogged with gratitude. They might have been speaking for many a U.S. citizen struggling during this recession: “Thank you for picking our town. It brought tears to my eyes when you announced it,” wrote “Kim.” “It will for sure put this town back on our feet. I was a Visteon employee for 16 years and my family has struggled for the past three years. This is like a light at the end of the tunnel for a lot of people.”
GE Chairman and CEO Jeffrey Immelt’s vision for a “dramatic industrial renewal” in the United States is being followed up with a new GE R&D center in Michigan. It’s also right in line with the vision of Carbon Motors President and CEO William Santana Li.
Li is fully aware of the emotional, psychological and patriotic need his company’s project fills. In an address to the International Motor Vehicle Program (iMVP) conference in Detroit in June 2009, he explained his idea to bring together sidelined financial talent, industrial venture capital and automotive technical talent to fund 100 new OEM startups over the next 18 months.
“Given that we all missed the meeting when everyone decided to dump our monies into effectively two sectors, perhaps its time to send out our own meeting notice for deciding we are going to invest in the industrial sector ? in earnest,” he said, noting that public-sector financial commitment would be necessary at all levels of government. “Yes, manufacturing, yes, automotive, and yes ? we actually make things that people buy and create real value and real jobs.”
Coincidentally, the same idea was being promulgated at nearly the same time and in the same city by the other corporate end user now moving into old Visteon property, General Electric. In a speech to the Detroit Economic Club concurrent with the company’s choice of Visteon Village for its new R&D center, GE Chairman and CEO Jeffrey Immelt said the United States should undergo a “dramatic industrial renewal” and aim for manufacturing to account for 20 percent of total employment.
“There is nothing predestined or inevitable about the industrial decline of the U.S., if we as a people are prepared to reverse it,” he said.
Carbon Motors, for one, is doing its part, at a time when, says Li, “people are tired of hearing about unemployment figures, TARP money and bailouts. They need a symbol of the U.S. turnaround. It’s the right time, the right product and, to top it off, the right location.”
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