Ford with major ressussitation of Detroit via Trump policies
The total investment announced Tuesday represents an additional $350 million above the investments negotiated as part of the 2015 United Auto Workers contract: Plans for the $200-million data center at Flat Rock are new; the company added $150 million to its budget for Michigan Assembly upgrades. The $150 million for Romeo plant upgrades were previously outlined in the UAW contract. According to the contract, the automaker will invest at least $9 billion in U.S. facilities through 2019.
Ford said the investments are expected to add or retain 130 jobs at the Romeo Engine plant; the Michigan Economic Development Corp. said in a memo that 100 new jobs would be created there. Ford did not offer employment estimates for Michigan Assembly, but the MEDC said 3,600 jobs would be secured at the plant. Ford said in January that the $700 million investment at Flat Rock would create 700 new jobs to support production of electrified and autonomous vehicles; the number of jobs to be created by the new data center was not released Tuesday.
Joe Hinrichs, Ford president of the Americas, said the investments show Ford is committed to boosting its truck and SUV lineup and investing in the industry’s future. “We’re making sure we’re well-positioned,” he said. “We’re investing a lot of money to grow... the portfolio will grow.”
The Michigan Strategic Fund board approved $12 million in grants for the Flat Rock and Michigan Assembly plants, and $18.95 million in property tax exemptions for the three sites. The fund is a semi-public state board that’s part of the MEDC.
Tuesday’s announcement came as President Donald Trump has pushed U.S. and foreign automakers to build factories and add jobs in the U.S.
When asked in a Tuesday press briefing if the White House or Trump could take credit for Ford’s announcement, Press Secretary Sean Spicer said the investments are a “continued sign” of “regulatory effort and some commitments on the regulatory efforts going forward in the future that I think may have played a role” in Ford’s and other company’s decision to invest in U.S. facilities.
The president tweeted early Tuesday before the news was announced: “Big announcement by Ford today. Major investment to be made in three Michigan plants. Car companies coming back to U.S. JOBS! JOBS! JOBS!”
The company has been planning some of the investments for “quite some time,” Hinrichs said. “It’s a mixed bag here for what’s new.”
The investments are big, Steve Arwood, CEO of the MEDC, told The Detroit News. “That probably nets out to be the biggest day ever in Michigan,” he said. “That’s all good news. There’s not a discouraging word.”
The retooling and expansions in Wayne and Romeo will start next year for 2019 and 2020 model-year vehicles.
Construction on the Flat Rock data center will begin later this year, Hinrichs said. It will be the company’s second data center; the first is under construction near the Ford World Headquarters in Dearborn.
Ford predicts its data storage requirements will expand by more than 15 times the company’s current capacity by 2021 due in part to growth in connected and autonomous vehicles.
Tuesday’s announcement drew praise from the UAW.
“Thanks to collective bargaining, the hard-working men and women at each of these locations will now reap the full fruits of their labor,” UAW-Ford Vice President Jimmy Settles in a statement. “We look forward to celebrating more product investment and job growth at each of our UAW represented facilities in the months and years to come.”
Ford stock closed up 1.66 percent at $11.65 Tuesday.
Honda North America announced plans late Monday to invest $85 million at its Honda Manufacturing of Alabama plant in Lincoln. The plant builds the Honda Odyssey, Pilot SUV and Ridgeline pickup and the Acura MDX and employs more than 4,500 people.