The investment surge is a reflection of the automakers’ belief that the U.S. market offers growth potential. But the decisions to invest in and around Detroit stem from “aggressive and welcoming” efforts from government leaders at the state and local levels, said Glenn Stevens Jr., executive director of Michauto, an organization within the Detroit Regional Chamber created to “protect, retain and grow” the state’s auto industry.
“There has to be the right business climate for companies to want to either locate here or expand here,” Stevens told Automotive News. “It’s sometimes said that Detroit was the Silicon Valley of the 1920s and ’30s. We’re actually seeing that kind of happen again.”
The investments are a sharp contrast to previous decades, when assembly plant projects gravitated to Alabama, Kentucky, Mississippi, South Carolina and Tennessee. While GM, in particular, struggled with North American factory overcapacity, international competitors BMW, Honda, Hyundai, Kia, Mercedes-Benz, Nissan, Subaru, Toyota and Volkswagen yearned for more North American plants.
The new Detroit-area investments “tell a tale of where the industry is and where it’s going,” Stevens said.