Howes: Investing in Flint and Detroit is cool again
Here in the industrial heartland, some old auto towns are getting some love.
It’s about time.
The latest is Flint, the “Vehicle City” laid low by its lead-tainted water crisis and General Motors’ decades-long exodus from so many operations there. Mahindra Automotive, the North American unit of its Indian parent, is angling to acquire the iconic Buick City site to build its first major assembly operation in the United States.
That could be huge – even if the site that once employed 27,000 GM hands ends up with just 2,000 jobs within the first five years. The symbolism would be enormous for Flint – an indication that the auto industry’s next generation may have a legit spot for a cornerstone of its last century.
Whether Mahinda moves ahead with Buick City depends on the results of environmental cleanup and incentive negotiations with state and local authorities. But CEO Rick Haas made it clear to me this week that the maker of Roxor off-road vehicles – and perhaps the next-generation delivery truck for the Postal Service – is hot for Flint.
Why? Because the company can make a difference in a city badly in need of fresh capital and tax-paying jobs. And because Mahindra can make a statement about its intentions and its rising standing in the evolving global auto scene.
What’s going on here? For decades, automakers couldn’t get far enough away from the likes of Flint and Detroit. Their political dysfunction, high cost of doing business and deteriorating economics combined to repel investment – that and the fact the plummeting market share forced Detroit automakers to continually jettison plant capacity, not add it.
Times have changed. Automakers that a decade ago were mired in bankruptcy are profitable, leaner and more attuned to the politics of their times. Reinvestment in a city like Detroit is part of today’s business zeitgeist – not the makings of a bad joke, or a risk not worth taking.
Oh, sure, the politics of today, in the era of “Make America Great Again,” reward those who reinvest in their hometown and punish those who don’t. But there’s more: investing at home is good business in towns America gave up for dead.
In places like Flint, where disinvestment and deindustrialization are real. Or Detroit, where risk can be rewarded.
Ford Motor is renovating the long-abandoned Michigan Central Depot into the anchor of a planned campus in the city’s Corktown neighborhood. Fiat Chrysler is investing $1.6 billion for a new Jeep plant on the city’s east side – and giving Detroiters the first crack at high-paying union jobs.
What’s going on is that investing in places like Detroit and Flint are cool again. Politicians help because direct investment redounds to their benefit. Corporate leaders help because they see the social benefit to the company, especially if the numbers pencil out. Employees help because they want to be part of something fresh and new that makes a difference.
Automakers are pumping real capital into cities they left, whether by choice, competition or both. That’s worth celebrating.
Daniel Howes is a columnist at The Detroit News. Views expressed in his essays are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.