Investment In Michigan Tied To Growth

July 21, 2005
$150 million Toyota Motor Corp. R&D center is planned for York Township.

By March 2009, Japan's Toyota Motor Corp. could be displaying a $150 million state-of-the-art R&D center in York Township, Mich., directly west of Detroit and about 15 minutes from the city's Metropolitan Airport. The project, now in the due diligence stage, is expected to create 677 jobs, 400 directly and, estimates the University of Michigan, another 277 indirectly as a result of increased economic activity.

The center is to be sited on 711 acres of what is now state-owned land and once the site of a psychiatric hospital.

Toyota is not a newcomer to Michigan. Its Toyota Technical Center USA Inc. (TTC) was established in 1977 and has its headquarters in Ann Arbor. In 2004, Toyota completed work on its Calty Design Research Studio next to the Technical Center.

"We think the York Township property is large enough to give us assurance of being able to plan for TTC's short-term as well as long-term growth," said Akihiko Saito, Toyota's executive vice president, when the project was announced this past April. "The North American growth in sales opened the door for Toyota to establish our manufacturing operations, which, in turn, supported the localization of our R&D presence. The York Township property will provide adequate space to conduct our engineering and research for Toyota's core North American vehicle development programs."

In addition to North America, Toyota has regional R&D centers in Europe, Australia and Thailand.

If, as expected, the York Township project goes forward, it will be a major achievement for Michigan Gov. Jennifer M. Granholm, who claimed Toyota's decision to locate there was "a testament to this state's comprehensive and aggressive strategy for attracting and retaining automotive investment and jobs." Her administration put together a $38.9 million incentive package to attract the new R&D center. According to the Michigan Economic Development Corp. (MEDC), a partnership between the state and local communities, the project will have a net $60.04 million revenue impact on the state, with $38.9 million in foregone revenue being more than offset by $98.95 million in expected revenue gain. The project is expected to generate about $1.2 billion in personal income for Michigan workers over the 20-year life of the tax credit. The governor also worked with Michigan's legislature to convey the land to attract the investment.

In August 2004, Granholm unveiled what was dubbed the Michigan Automotive Industry Economic Development/Investment Strategy, a program to increase automotive production and R&D jobs in Michigan.

The Toyota R&D center in York Township is one of several major auto industry investments in Michigan announced during the past several months, including investments by DaimlerChrysler, General Motors Corp., Nissan and Detroit Diesel, notes MEDC. "These five projects alone will generate more than $1.2 billion in investment and create and retain an estimated 27,000 Michigan jobs," it claims.

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