ArcelorMittal Sees its Future in an Old Detroit Plant

By: Paul Eisenstein

Driving through the old neighborhood on Detroit’s east side there’s a good chance you’d barely  notice the 92-year-old brick building, just one of many ancient factories left over from another era when Detroit was the indisputable center of the automotive universe. Slow down a bit and you might realize something dramatic is happening there – and at several other old plant sites nearby.

Originally opened in 1926 by the R.C. Mahon Co., a specialty steel producer, the 313,000 square-foot factory has come back to life to serve much the same purpose, albeit today producing state-of-the-art tailored blanks and other products for ArcelorMittal, the world’s largest steel manufacturer.

“In five years, you won’t know the area.It’s changing, and changing for the better,” says Mike Clark, the director of purchasing for the ArcelorMittal subsidiary, as he points to all the redevelopment efforts going on nearby, even the old party store across the street undergoing a renovation.

ArcelorMittal operates a similar factory in Ohio, but having experienced 30 percent growth for its specialty unit in the past two years, it recognized the need to add another plant. It looked at an assortment of sites in the Great Lakes region before settling on the Mt. Elliott factory.

Some of the advantages were obvious, including Detroit’s available and well-trained workforce, and “this is where our customers are,” ArcelorMittal supplying specialty metal products to all of the Detroit Big Three, as well as a Who’s-Who of imports.  Meanwhile, the Luxembourg-based steelmaker also had to deal with a compressed timetable, just 13 months to get a new factory into production.

Clark is quick to give much of the credit for making that possible to the Detroit Regional Chamber. “They aligned us with the right people to make it more favorable than any other location, among other things helping line up city and state incentives, including funding to improve the stretch of road between the plant and I-94.”

“They gave us the green-light,” he says, adding that the steelmaker was happy with what the Chamber pulled together.

In an era when many manufacturers prefer to move to the suburbs and build from the ground up, Clark said that it made much more sense for ArcelorMittal to move into the old factory. True, it took extensive renovation effort, but even after pumping in $40 million – the owner of the property kicking in another $10 million – the numbers made sense, especially with the short deadline for meeting new production contracts.

“Investments like ArcelorMittal’s in the Detroit region are what our organization strives for every day,” said Sandy Baruah, president and CEO of the Detroit Regional Chamber. “We are actively out recruiting companies with the best technology that can help drive our core industries forward. The Chamber’s business attraction efforts seek to communicate to companies the advantages of locating to our region and then we connect them with the real estate, incentives, services and partners they will need to bring their project to fruition in our community, ultimately putting more of our residents to work.”

Economic development is a team sport and this project relied on tremendous additional support from DTE Energy, the Michigan Economic Development Corp. and the City of Detroit to get it across the finish line.

ArcelorMittal is still ramping up operations at the Detroit plant – which includes not only the manufacturing shop, a metrology and metal research lab, and a variety of sales and executive management offices. The first-year target is to create 84 jobs – but that could be exceeded, Clark notes. Sales for the specialty unit hit $158 million in 2017 and the forecast is that they will reach $258 million by 2019.

The company is already looking to the future, its three-to-five-year North American plan calling for additional expansion. Though it did sign a 15-year lease, the company hasn’t locked down longer-term plans. That said, Clark said he is upbeat that, by working with the Chamber, the stars may again fall into alignment favoring further expansion in the city of Detroit.

Destination Detroit Collaborating on Major Business Attraction Effort for Amazon’s HQ2

The Detroit Regional Chamber is a key part of a broad and inclusive leadership group working under the chairmanship of Quicken Loans’ Dan Gilbert to prepare a world-class proposal for Amazon’s second headquarters.

Amazon’s search for a second headquarters has sent economic developers across North America into overdrive vying for this coveted project.

The Chamber will bring its expertise in economic development, business attraction, regional transit, talent and next-generation mobility as well as research capabilities to the coalition.

The coalition is off to a fast and strong start. Detroit has significant assets to be very competitive in this project and a first-rate team assembled. Read some of the regional coverage here.

Forward Detroit Quarterly Results

April–June 2017

The Detroit Regional Chamber’s Forward Detroit strategy programs and initiatives reported the following results for the April to June 2017 quarter.

The Detroit Regional Chamber’s Business Attraction team worked with the Michigan Economic Development Corp., Oakland County and city of Troy to close a deal to bring the North American headquarters for Dutch automotive engineering service firm, VDL Steelweld to the region. The company leased a 50,000 square foot facility in Oakland County, investing $1.22 million in the region and adding 43 new jobs that pay an average of more than $100,000 annually.

Learn more about the Chamber’s Business Attraction efforts. 

 
MICHauto, an initiative of the Chamber, held a Legislative Supplier Fair and Reception and its annual Auto on the Island programming in May at the Mackinac Policy Conference. The fourth annual Supplier Fair and Reception connected more than a dozen suppliers with lawmakers to continue the discussion on the economic impact of suppliers across the state.

Continuing to bring the industry to the forefront of conversations, MICHauto hosted 35 industry CEOs on Mackinac Island for Auto on the Island. The challenges, opportunities, threats and weaknesses facing the automotive and mobility industry were discussed among the CEOs present as well as in a discussion with Gov. Rick Snyder and Mayor Mike Duggan. Automotive stakeholders also participated in an automotive roundtable discussion that focused on human capital in the digital age.

Learn more about MICHauto.

 In spring 2017, the Detroit Drives Degrees (D3) team launched two surveys to increase the Detroit region’s population by putting a greater focus on retaining existing residents and attracting new ones. The surveys resulted in 500 responses that will be used to further build out D3’s talent attraction and retention strategies.

To further communicate D3’s work in talent to a broader audience, Sarah Craft, program manager, sat on a panel for the Detroit Regional Relocation Council Quarterly Business Meeting, where she informed 50 national relocation professionals on Detroit’s assets and appeal. Additional panelists included: University Moving Storage’s Ben Cross; Center City Properties’ Michael Martorelli; Quicken Loans’ Dan Ngoyi; and Hall & Hunter’s Amy Zimmer.

At the May D3 Leadership Council meeting, the team brought together education experts from Cleveland to talk to the Council’s representatives in higher education, business, government, philanthropy and the nonprofit sector about a national model proven to improve student success. The goal of the discussion was to understand how Cleveland has successfully increased its educational attainment rate and how a similar model can be implemented in Detroit.

Learn more about Detroit Drives Degrees.

Read more about what the Forward Detroit initiatives accomplished:

Michigan’s Mobility Assets Key Topic of Netherlands Delegation Visit to Detroit

Detroit’s Tech, Automotive Leadership Takes Spotlight During Israel Mission Trip

MICHauto Roundtable: Technology Innovation Will Augment Workforce Transformation

Economic Impact of State’s Auto Suppliers Key Topic at Annual MICHauto Legislative Reception

W.K. Kellogg Foundation Awards $3.5 Million Grant to Detroit Promise to Help Students Pursue Higher Education

Detroit Drives Degrees Gleans Lessons from Higher Education Compact of Greater Cleveland to Increase Local Graduation Rates

Help Detroit Drives Degrees Attract and Retain Talent in Southeast Michigan

MICHauto Supports Student Entrepreneurs in Lear Open Innovation Challenge

Detroit’s Tech, Automotive Leadership Takes Spotlight During Israel Mission Trip

In a follow-up to a January fact-finding mission to Israel earlier this year led by Mark Davidoff, Michigan managing partner at Deloitte, and the Jewish Federation of Metropolitan Detroit, the Detroit Regional Chamber, along with economic development representatives from Oakland County, returned to the country in May to meet with automotive and manufacturing companies looking to expand into the U.S. market.

“Following our fact-finding mission in January, we saw an opportunity in Israel beyond the country’s robust cybersecurity sector to the larger automotive technology landscape,” said Justin Robinson, vice president of Business Attraction for the Detroit Regional Chamber.

“Our Business Attraction program has made a shift to recruit more early-stage automotive technology companies and we are looking to the markets that we believe hold the greatest potential to bring that technology to Southeast Michigan — Israel and Silicon Valley,” he added.

The trip, which took place May 15-19, was timed to coincide with Ecomotion 2017, a worldwide conference focused on promoting knowledge-sharing among companies in the smart transportation sector (pictured).

During the week, the delegation held 25 one-on-one meetings with venture capital companies, automotive accelerators and startups, to glean information on how to best support Israeli companies that have an eye toward the North American market. Primarily, Robinson said companies expressed the need for better connections to OEMs (such as Ford Motor Co. and General Motors Co.) and Tier 1 and 2 suppliers.

“It was a great opportunity to listen and understand what we need to be doing as a region to better position ourselves to connect this new startup ecosystem with the established automotive ecosystem in Detroit,” he said.

There are roughly 6,000 startups in Israel today. As more pop up due to the country’s rich talent pool and government support for entrepreneurs, many companies are setting their sights to North America to scale their business quickly, Robinson said.

“Mobility is becoming one of the key areas of focus, which is a perfect opportunity for Michigan,” he said.

For more information on Forward Detroit, contact Marnita S. Harris at mharris@detroitchamber.com or 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page.

Forward Detroit Quarterly Results

January – March, 2017 

 
Between January and March, the Detroit Regional Chamber’s Business Attraction team assisted in closing three deals, which created 97 jobs and brought in an investment of $4.8 million to the Detroit region. Learn more about the Chamber’s Business Attraction efforts.
Investor Blog_D3_4.17
During the last quarter, the Chamber’s Detroit Drives Degrees (D3) initiative wrapped up the Race to the FAFSA Line challenge for Southeast Michigan. Since the kickoff of this challenge in October, 16,467 students in Macomb, Oakland and Wayne counties have completed their FAFSA. These students extend from 85 schools that participated and five were awarded for their outstanding completion rates. Learn more about the Detroit Drives Degrees.
MICHauto, Michigan’s first-ever strategic initiative dedicated to promoting, retaining and growing the automotive and next-generation mobility industry is a program under the Chamber’s Forward Detroit strategy. During the last quarter, MICHauto held a Legislative Tour and Reception during the North American International Auto Show, educating 32 elected officials on the industry. In addition, MICHauto held a Discover Auto career series event that exposed 72 Oakland University students to automotive careers with the participation of 12 automotive suppliers. Learn more about MICHauto.

 

Read more about what the Forward Detroit initiatives accomplished:

Education Advocates: Reform, More Training Opportunities Needed to Sustain Detroit’s Momentum

 

Tech Startup Lessons from Israel: Entrepreneurs Thrive with Collaboration, Government Support

Business and Education Leaders: College Access Programs Are Launchpad for Region’s Economic Prosperity

 

Tech Startup Lessons from Israel: Entrepreneurs Thrive with Collaboration, Government Support

A robust talent pipeline. Government support for startups. Strong academic and STEM education programs. No fear of failure. These are just a few of the key ingredients that contribute to Israel’s status as a top five global technology startup hub.

In an effort to better understand the Israeli ecosystem of innovation, the Detroit Regional Chamber recently attended a five-day, fact-finding mission to the country led by Deloitte and the Jewish Federation of Metropolitan Detroit. It was held concurrently during Gov. Rick Snyder’s Israel trip to enhance business ties with Michigan.

The delegation included chief information technology officers and executives from AT&TConsumers EnergyGeneral Motors, Henry Ford Health System, and nine additional organizations across the state.

During the week, the delegation met with key decision-makers from 12 leading technology startups and attended the 2017 CyberTech Conference in Tel Aviv to hear from cyber experts from multi-national corporations, startups, private and corporate investors, and venture capital firms. Gov. Snyder provided opening remarks at the Conference (pictured).

The group also met with Avi Hasson, Israel’s chief scientist, and received an up-close look at AT&T’s latest innovation center in Raanana, GM’s Advanced Technical Center in Tel Aviv, and Israel’s Startup Nation Central, a nonprofit focused on getting innovation in front of leading companies around the world.

Other stops included meetings with the Israel Defense Forces (IDF) Talpiot Program, an elite training program for students who excel in science and technology; and CYBERBIT, a global leader in cybersecurity and intelligence.

Building Relationships to Maintain Michigan’s Mobility Leadership

In sheer size comparison, Michigan is 11 times larger than the entire country of Israel. Despite that, estimates put Israel’s startup companies at nearly 1,000 in a given year.

Driving this entrepreneurial boom is a combination of Israel’s mandated military service and the resulting talent development, and robust seed funding from the government and venture capital firms for startups.

Public and private collaboration, along with a dedicated source of government funding, is an area where Detroit and Michigan can draw lessons.

“With more than 90,000 engineers, Detroit is also an innovation center with a similar ecosystem. But where our companies are built to drive innovation internally to meet the needs of their own customers, Israel is more externally focused,” said Justin Robinson, vice president of business attraction for the Chamber.

“The trick is, how do we take our innovation culture and flip it around to encourage more collaboration and information sharing, especially as we look to be a leader in solving issues around global mobility moving forward?” Robinson added.

He said one thing is clear:

“Israel is a market Michigan must have a close relationship with not only because of the volume, but also the quality of innovation taking place. They have a culture that asks partners, ‘bring us your problems’ – and there are no shortage of challenges in delivering autonomous driving to the world,” he said.

“The Chamber and MICHauto are committed to further enhancing the connections between our established automotive industry and venture capital community with the technology ecosystem in Israel. Doing so will be a win-win for both of our communities,” Robinson added.

For more information on Business Attraction, contact Justin Robinson at jrobinson@detroitchamber.com or 313.596.0352.

For more information on Forward Detroit, contact Marnita Hamilton at mhamilton@detroitchamber.com, or 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page.

Michigan Business Delegation Explores Israeli Startup Ecosystem, Cybersecurity Innovation

By Daniel Lai

The Detroit Regional Chamber recently joined 15 organizations across the state for a five-day fact-finding mission on Israel’s booming startup culture and cyber innovation hosted by Deloitte and the Jewish Federation of Metropolitan Detroit.

The mission is part of an ongoing effort to build relationships with key government leaders in the country while also connecting Michigan companies with startups and business accelerators in order to develop collaborative technology solutions to strengthen the state’s leadership in connectivity and next-generation mobility.

In addition to the Chamber, the delegation included representatives from AT&T, ChoiceTel, Consumer Energy, Cornerstone Schools, Crain’s Detroit Business, Downtown Detroit Partnership, General Motors Co., Henry Ford Health System, ITC Holdings Corp., Michigan State Police and The Right Place.

Highlights from the week included:

  • Attending the 2017 CyberTech Conference in Tel Aviv to hear from industry experts in cybersecurity
  • Touring AT&T’s latest innovation center in Raanana, GM’s Advanced Technical Center in Tel Aviv and Israel’s Startup Nation Central, a nonprofit focused on getting innovation in front of leading companies around the world
  • Meeting with Avi Hasson, Israel’s chief scientist
  • Hosting meetings with decision-makers from more than 12 technology companies

Israel has the highest density of tech startups in the world cultivated by highly trained graduates from the military establishment, robust government investment in innovation and STEM education. That public and private synergy is ripe for entrepreneurial growth.

“It is very clear that Israel is a market Michigan must have a close relationship with not only because of the volume, but also the quality of innovation taking place. They have a culture that asks partners, ‘bring us your problems’ – and there are no shortage of challenges in delivering autonomous driving to the world,” said Justin Robinson, the Chamber’s vice president of business attraction.

“The Chamber and MICHauto are committed to further enhancing the connections between our established automotive industry and venture capital community with the technology ecosystem in Israel. Doing so will be a win-win for both of our communities,” he added.

Daniel Lai is a communications specialist and copywriter at the Detroit Regional Chamber. 

Forward Detroit Quarterly Results

Quarterly Investor Results

Oct. to Dec. 2016 

Investor Blog_Business Attraction
The Detroit Regional Chamber’s Business Attraction team assisted in closing six deals in the Detroit region, which created 254 jobs and brought in $103,750,254 of investment. Learn more about the Chamber’s Business Attraction efforts.

 

Investor Blog_D3
The Chamber’s Detroit Drives Degrees (D3) initiative introduce the Race to the FAFSA Line challenge for Southeast Michigan. Since the kickoff of this challenge in October, the D3 initiative trained 170 high school counselors on the Federal Application for Student Aid (FAFSA) completion and recruited 80 students leaders to encourage FAFSA completion in their schools. So far, 13,630 students in the region completed the FAFSA in that quarter. Learn more about the Detroit Drives Degrees.

Read more about what the Forward Detroit initiatives accomplished:

Taking a Data-Driven Approach to Increasing Graduation Rates for Low-Income, Minority Students

Detroit’s Next Opportunity: A Premier Destination for Health Care Innovation, Investment

Industrial Space, Talent Attraction Impacting Detroit’s Sustainable Growth

For Auto Industry, Attracting and Retaining Millennial Talent Requires an Inclusive Company Culture

 

For more information on Forward Detroit, contact Marnita Hamilton at 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page. For more information on Business Attraction, contact Justin Robinson at 313.596.0352. For more information on Detroit Drives Degrees, contact Greg Handel at 313.596.0331.

Forward Detroit Quarterly Results

Quarterly Investor Results
July–September 2016

investor-blog_business-attraction
For the July to Sept. quarter the Detroit Regional Chamber’s Forward Detroit strategy reported the above results. The Chamber’s Business Attraction team assisted in closing three deals in the Detroit region, which created 223 jobs and brought in $69 million of investment. Learn more about the Chamber’s Business Attraction efforts.
investor-blog_dp
The Chamber’s Detroit Promise initiative identified 402 students in Detroit that were eligible for the four-year scholarship opportunity. The Detroit Promise enrolled 263 students in public four-year universities in Michigan and 650 students in five local two-year community colleges. Learn more about the Detroit Promise.

Read more about what the Forward Detroit initiatives accomplished:

Economic Developers Find Collaborative Solutions for Regional Investment at MEDA Conference

Detroit Promise Expands Support Services to Increase Graduation Rates

Detroit Promise Summer Ceremony Celebrates Start of New Year for College-Bound Students

Macomb, Oakland County Tour Highlights Auto and Manufacturing Assets to National Site Selectors

Global Automotive Forum Offers Insight Into Future of Mobility Industry in China

For more information on Forward Detroit, contact Marnita Hamilton at 313.596.0310. To view a full list of investors and past Investor Exclusive content, visit our Investor Resources page. For more information on Business Attraction, contact Justin Robinson at 313.596.0352