Talent and R&D: Engineering a Workforce

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1 September 2014

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3 University of Michigan Talent and R&D: Engineering a Workforce Home to more than 89,000 engineers, Michigan ranks first in the nation for its concentration of engineering and architecture talent. It has the highest concentration of industrial and mechanical engineers in the U.S., and as of May 2013, Michigan employed more industrial engineers (24,430) and mechanical engineers (32,640) than any other state in the country. 24,430 32,640 Highly Skilled, Competitive Workforce Michigan Ranks: #1 in mechanical engineers #1 in industrial engineers 4,970 7,300 4,530 #2 in mechanical engineering technicians #4 in electrical engineers 1,060 #6 in electrical and electronics engineering technicians #8 in materials engineers michauto.org 3

4 Nationally Ranked Engineering Programs Michigan has 16 universities and colleges with nationally ranked undergraduate engineering programs, four of which also have nationally ranked graduate programs, according to the 2015 U.S. News & World Report. Michigan Technological University Eight ranked engineering graduate programs. University of Michigan Nine graduate programs ranked in the top 10. Undergraduate Calvin College Central Michigan Universtiy Ferris State University Grand Valley State University Hope College Kettering University Lake Superior State University Lawrence Technological University Michigan State University Michigan Technological University Saginaw Valley State University University of Detroit Mercy University of Michigan-Dearborn University of Michigan Wayne State University Graduate Michigan State University Michigan Technological University University of Michigan Wayne State University Western Michigan University* Michigan State University Seven ranked engineering graduate programs. Hope College Calvin College Central Michigan University Kettering University Two undergraduate programs ranked in the top 10. Michigan State University Wayne State University Five ranked engineering graduate programs. Undergraduate Western Michigan University University of Michigan University of Detroit Mercy Wayne State University Undergraduate and Graduate *Only graduate program 4 Michigan Is Auto

5 The University Research Corridor The University Research Corridor (URC) which includes Michigan State University, the University of Michigan and Wayne State University is the premier collaborative automotive education program in the nation. URC universities have 23 research centers, laboratories and partnerships and graduate more than 3,600 students annually in technical careers for the automotive industry. Automotive R&D Hub Brain Power for the Auto Industry Michigan remains the preeminent place for auto-related research and development where key industry players from around the world have facilities to remain at the forefront of innovation. Michigan is home to 375 automotive R&D centers, 120 of which are foreign-owned. According to the Center for Automotive Research, $8.9 billion or 76 percent of $12 billion in R&D business in Michigan was automotive related leading the nation in automotive related R&D. Between 1964 and 2012, Michigan accounted for more than 27 percent of the automotive patents issued nationwide, averaging 1 automotive patent per day for 49 years. This outpaces every state in the nation by more than 300 percent. Global or North American R&D Headquarters in Michigan Additional Auto Manufacturers with R&D Facilities in Michigan Talent and R&D 5

6 General Motors Manufacturing Expertise: Michigan s Unrivaled Production In addition to top tier engineering talent, Michigan employs a highly skilled manufacturing labor force at nationally competitive wages. As a result, Michigan has led the nation in manufacturing jobs created between 2010 and 2013, adding nearly 73,784 jobs. Since 2010, Michigan has created 30,270 jobs specific to automotive manufacturing, which equals more than 20 jobs created every day for 4 years. Automotive Manufacturing Footprint Michigan s renowned manufacturing expertise and footprint power unrivaled automotive production levels in the nation and continent. Michigan leads the nation in motor vehicle and motor vehicle parts manufacturer establishments with 1,741. Nearly 25 percent of these (419) are foreign-owned. There are 1,415 tool and die establishments in Michigan, more than any other state. Michigan leads the nation in original equipment manufacturer (OEM) assembly plants with 13. There are 35 OEM components/materials plants in Michigan, more than any other state. Michigan is the capital of the global automotive industry, and General Motors has been proud to call it our home since The state s business and manufacturing environment and expertise are unequaled, which is why we base so much of our research and development, design, engineering, and manufacturing workforce here, and so does our broad supplier base. GM s long history and strong relationship with Michigan has resulted in a successful public and private partnership, one that will continue and flourish for years to come. Mark Reuss, Executive Vice President, Global Product Development, Purchasing and Supply Chain, General Motors 6 Michigan Is Auto

7 Michigan Vehicle Production by the Numbers Michigan s vehicle production of 2.47 million in 2013, exceeded the pre-recession levels of 2.33 million of 2007, exceeding the next closest state s production by over 1 million vehicles. 2,471,636 2,333,271 2,000,000 2,263,638 # Produced 1,852,654 1,586,181 1,909,119 1,146,134 1,000, % U.S. Production 21.2 % U.S. Production 19.9 % U.S. Production 20.3 % U.S. Production 22 % U.S. Production 22.3 % U.S. Production 22.9 % U.S. Production 15 % North American Production % North American Production % North American Production 13 % North American Production 14.2 % North American Production % North American Production % North American Production 2013 Source: Automotive News Year Competitive Hourly Wages A highly skilled workforce at nationally competitive wages makes Michigan the best value option for accessing world-class manufacturing talent to compete in the 21st century global economy Source: Bureau of National Affairs Manufacturing Expertise 7

8 Investment and Infrastructure: Unmatched in the World Whether it s Michigan s renowned supplier network or the logistical infrastructure to move freight anywhere in the world, the assets in the Motor State make it a magnet for automotive investment. According to the Center for Automotive Research, between 2010 and July 2014, automakers and suppliers invested $16.3 billion in Michigan, nearly $2.8 billion of which came from 76 foreign automotive firms from 20 different countries. In 2013, 28 Michigan counties received more than $2.3 billion in automotive investment, creating nearly 11,000 jobs. Automotive Trade: Imports and Exports Imports and exports of transportation equipment to and from Michigan companies grew significantly between 2009 and Michigan companies exported more than $29 billion in transportation equipment to 169 countries in 2013, an increase of nearly 105 percent from In 2013, automotive exports to Canada totaled nearly $14.8 billion 51 percent of Michigan s transportation equipment export total. Michigan companies imported more than $76 billion in transportation equipment in 2013, an increase of more than 110 percent from In 2013, automotive imports from Canada totaled nearly $34 billion 44 percent of Michigan s transportation equipment import total. 8 Michigan Is Auto

9 63 of the Top 100 Automotive Suppliers to North America are Headquartered in Michigan Decision Making Headquarters for the Global Auto Industry Ann Arbor (1) NSK Americas Auburn Hills (2) Alps Electric North America, Inc. Autoliv North America Benteler Automotive Corp. BorgWarner Inc. Brose North America, Inc. Continental AG Dow Automotive Dura Automotive Systems, LLC Faurecia GKN Driveline Grupo Antolin North America, Inc. Henniges Automotive Magneti Marelli Holding USA TI Automotive Ltd. TK Holdings, Inc. Canton (3) Yazaki North America, Inc. Detroit (4) American Axle and Manufacturing Bridgewater Interiors Farmington Hills (5) AEES Autoneum North America, Inc. JATCO USA Mahle Industries, Inc. Mobis North America Robert Bosch, LLC Livonia (6) Tower Automotive, Inc. TRW Automotive, Inc. Mount Pleasant (7) American Mitsuba Corp. Plymouth (10) Aisin World Corp. of America Hella Corporate Center USA, Inc. Honeywell Johnson Controls, Inc. JTEKT Automotive Group Cos. Metaldyne, LLC Sanluis Rassini, S.A. DE C.V. TRAM, Inc. Rochester Hills (11) Webasto Roof Systems, Inc. Saginaw (12) Nexteer Automotive Shelby Township (13) CIE Automotive USA, Inc. Southfield (14) Denso International America, Inc. Federal-Mogul Corp. Grede Holdings, LLC IAC Group North America Lear Corp. South Haven (15) TrelleborgVibracoutic Sterling Heights (16) Key Safety Systems Troy (17) Delphi Automotive, LLP DuPont Automotive Gestamp North America Inteva Products, LLC Kautex Textron North America Plastic Omnium Co. Schaeffler Group North America Toyoda Gosei North America Corp. Valeo, Inc. Manistee Traverse City Ann Arbor Mt. Pleasant 1 WASHTENAW 7 Gaylord Grayling Pontiac OAKLAND 19 Saginaw Alpena Tawas City WAYNE 13 MACOMB Detroit Mt. Clemens Port Austin 16 Bad Axe Northville (8) ZF Group NAO Van Buren Township (18) Visteon Corp. Grand Rapids Flint Port Huron Novi (9) Cooper-Standard Automotive Eberspaecher North America, Inc. Kongsberg Automotive Mando America Corp. Maxion Wheels Warren (19) SRG Global, Inc. 15 Benton Harbor/ St. Joseph 6 Battle Creek Lansing Monroe Detroit Source: Automotive News Investment and Infrastructure 9

10 Michigan is recognized as the automotive capital of the world for many good reasons. Toyota is pleased to conduct its North American engineering and research activities where the action is. The engineering and design synergy created through the huge supplier base and engineering talent centered in Michigan is why Toyota continues to expand our R&D operations here. Simon Nagata, President and CEO, Toyota Motor Engineering & Manufacturing N.A., Inc. Logistics & Infrastructure Whether it s Michigan s renowned manufacturing base and R&D, professional service firms with dedicated automotive practices, or its ideal global location, Michigan has an automotive infrastructure that is unmatched anywhere in the world. Michigan is only 500 miles, or a day s drive, from half of the population of the United States and provides the infrastructure needed to transport products and people there and across the world. Michigan has an extensive network of logistical assets that make moving automotive components a breeze. ROAD RAIL Michigan is among the top 10 in the nation for road infrastructure with 1,244 miles of interstate highway and 8,480 miles of U.S. and state highways. Michigan is one of only two2 Great Lakes states with toll -free highways. Michigan is served by 28 freight railroads (7th in the country) covering 3,634 miles of rail (12th in the country). In 2011, Michigan railroads moved more than 4.1 million tons of motor vehicles and parts on 246,600 carloads, more than any other state. AIR WATER Michigan has 18 commercial airports, including the 18th busiest airport in the world, Detroit Metropolitan Wayne County Airport (DTW). DTW offers 280 international flights weekly and ranks in the top 25 for cargo movement in North America. Willow Run Airport handles more than 160 million pounds of cargo annually including high-value automotive and electronic components. Michigan has 40 commercial ports, 38 of which are deep water ports. The Port of Detroit is the third largest international gateway in the United States and connects the Great Lakes and the entire Midwest to the St. Lawrence Seaway. 10 Investment and Infrastructure

11 Intelligent Mobility: Leading Connected Vehicle Technology Michigan is uniquely positioned to lead the world in the development and integration of automotive technology that will define 21st century intelligent mobility. In 2012, Michigan led the United States in connected vehicle projects (30). The United States is the global leader in these projects, with 44 percent of projects worldwide. The Detroit region is a leader of connected vehicle programs with locations in 8 cities in Southeast Michigan. The state of Michigan is currently utilizing real-world deployment of comprehensive, multi-modal connected vehicle systems, testing vehicle-to-infrastructure and vehicle-to-vehicle communications on more than 2,800 vehicles (passenger, commercial and transit buses). The Detroit region is home to the largest deployment of video imaging for traffic management in the world. More than 200 miles of freeway in the Detroit region are instrumented for 456 closed-circuit television cameras, 203 dynamic message signs, 488 microwave vehicle detector sites, 57 environmental sensor stations, 34 communication hubs and 7 travel time signs. General Motors is leading intelligent mobility efforts in Michigan with the first V2V-equipped car, the 2017 Cadillac CTS. GM is also joining the Michigan Department of Transportation, the University of Michigan s Mobility Transformation Center and other automakers to create V2I-enabled corridors on 120 miles of metro Detroit roadways, the largest deployment of V2I technology in the U.S. Michigan is an iconic automotive hub from a strong technical workforce to innovative companies to effective OEM and supplier relationships it truly is the best place for industry growth. That s why at IAV, we re proud to have an expanding presence in Michigan. This includes bringing our highly automated driving expertise here, to the Great Lakes State, to assist in building a robust, intelligent mobility infrastructure. Leveraging the extensive automotive resources and talent pool in the region will further illustrate the state s key leadership position in developing state-of-the-art driving systems and its role in advancing the industry as it pursues intelligent mobility success. Andy Ridgway, President of IAV Automotive Engineering, Inc. michauto.org 11

12 Infrastructure and Resources University of Michigan Transportation Institute (UMTRI) Dedicated to achieving safe and sustainable transportation for a global society, UMTRI has a multimillion-dollar research program. Its key initiatives include the Center for the Management of Information for Safe and Sustainable Transportation and Michigan Mobility Transformation Center. The University of Michigan s new Mobility Transformation Center (MTC) broke ground on a $6.5 million connectivity test facility it is developing with the Michigan Department of Transportation on the university s north campus. When the 32-acre track opens, researchers will be able to test connected and autonomous vehicles in a simulated urban environment. The MTC aims to transfer results at the track to a 20,000-vehicle demonstration system in Ann Arbor and two other locations in Southeast Michigan by Southeast Michigan Connected Vehicle Test Bed Encompassing 75 linear miles, the most extensive test bed in the nation provides companies the capability to test safety, mobility, environmental applications and components, led by the U.S. DOT s Vehicle-to-Vehicle (V2V) and Vehicle-to-Infrastructure (V2I) research program. Former Willow Run Powertrain Plant Proposed home for a technologically advanced connected vehicle research center, a project that could become a hub of research and development for the vehicles of tomorrow and a catalyst for jobs in innovative automotive research. Oakland County Connected Car Task Force Oakland County has a task force to determine how to deploy the first countywide connected vehicle infrastructure system, which will collect information from connected vehicle stakeholders and industry leaders and experts in order to develop an implementation plan. NextEnergy One of the nation s leading accelerators of advanced energy technologies, business and industries. This includes: building energy management systems, demonstration of next generation solid state lighting, Vehicle to-grid (V2G) commerce, and connected vehicles in a dedicated short range communications (DSRC) framework. 12 Intelligent Mobility

13 Andrew Potter Photography Innovation, Collaboration & Growth: Michigan s New Automotive Strategy In 2013, Gov. Rick Snyder created the Michigan Automotive Office within the Michigan Economic Development Corporation (MEDC) to develop and lead a 30-year strategic plan. The office drives action to support the industry, retain automotive businesses and attract new ones, and complement the state s overall economic growth strategy. Major Michigan Legislative Advances January 1, 2012 December 12, 2012 Positive Tax Reform Passed Michigan s new corporate income tax is the lowest in the Midwest and is among the lowest in the nation. Right-to-Work Law Passed Michigan became the 24th right-to-work state in the United States. December 20, 2012 Personal Property Tax Eliminated Michigan eliminated its personal property tax on industrial property to be more manufacturing-friendly. December 27, 2013 Driverless Car Legislation Signed Gov. Snyder signed legislation allowing manufacturers to test driverless cars on Michigan roads. July 31, 2014 Regulations Decreased Thus far, 1,600 obsolete, unnecessary and burdensome rules have been eliminated in Michigan. michauto.org 13

14 Developing the Future The Michigan Automotive Office and MEDC collaborate with industry, academia and government to advance automotive technologies, attract and develop high-skilled talent, and make the case for greater private capital investment. Michigan Advanced Technician Training Program (MAT2) An industry-driven approach to workforce training, MAT2 offers employer-paid tuition and on-the-job training with pay, and is open to graduating high school seniors or students currently enrolled in community colleges or four-year universities. American Lightweight Materials Manufacturing Innovation Institute Led by University of Michigan, Ohio-based manufacturing technology nonprofit EWI and Ohio State University, it will establish an ecosystem to support production of lightweight materials. Domestic & International Business Development Capitalizing on new opportunities afforded by a much-improved business climate, the MEDC and auto office are engaging both Michigan-based and global automotive businesses to execute their growth plans here. In FY 2013, the state partnered on 34 automotive investment projects with more than 7,200 jobs committed and $953 million in private investment ($180 million in public support). Between January 2011 and May 2014, there have been 359 foreign direct investment projects in Michigan representing a total capital investment of $9 billion, and over 31,000 new jobs. Out of a total 359 foreign direct investment projects, the automotive industry accounted for 18.1 percent of the projects, creating over 10,000 jobs and $1.7 billion in capital investment. Supporting Business Growth Businesses need capital to grow and diversify. To incentivize tight capital markets to lend, Michigan has developed creative methods to provide the capital businesses need to grow and prosper. Michigan Business Development Program (MBDP) The MBDP provides grants, loans or economic assistance to qualified businesses that create investments and jobs in Michigan. Michigan Business Growth Fund The Michigan Business Growth Fund operates several programs that assist lenders and borrowers in financing expansion or diversification projects within the state of Michigan. Capital Access Program (CAP) CAP uses small amounts of public resources to support private bank financing, providing small Michigan businesses access to capital that might not otherwise be available. Private Activity Bonds (PABs) The MEDC, through the Michigan Strategic Fund, can issue tax-exempt and taxable PABs for credit-worthy companies considering investing in eligible projects. American Axle & Manufacturing is experiencing significant year over year sales growth, much of which occurs right here in Michigan. Seven of our thirty-four global facilities are located here, and we recently invested over $130 million to launch our new disconnecting AWD system in Three Rivers. The technical facilities, human talent, and assistance from governmental agencies and economic development organizations greatly enhance our ability to achieve this type of success. David C. Dauch, Chairman, President & CEO, American Axle & Manufacturing 14 Innovation, Collaboration & Growth

15 Whether it s high-tech engineering, top-notch research, a highly skilled workforce or close proximity to a premier global supply chain, Michigan has it all. Nowhere else is there as dense an automotive industry cluster with manufacturers, suppliers and businesses from around the globe. The Detroit Regional Chamber represents a united, 10-county area of Southeast Michigan home to more than 315,000 companies and 5.3 million people. The Detroit region provides a dynamic and cost-competitive environment capable of supporting today s global businesses. This document combines substantive data and testimonials from automotive experts to prove Michigan and the Detroit region is the global epicenter of the automotive industry. I contend there is no place more ideal to design, engineer and mass-produce automobiles or auto-related components than here. Thank you for taking a look at all the reasons why Michigan is Auto. Sandy K. Baruah President and Chief Executive Officer Thank you This report was developed in partnership with:

16 For more information on locating or expanding automotive business in Michigan, please michauto.org