Crain’s Detroit Business
By Dustin Walsh
January 8, 2017
The state’s Planet M mobility initiative is aiming to play matchmaker between companies in Michigan and Silicon Valley.
Planet M, a branding partnership between the state and local economic development firms, businesses and colleges, plans to identify and solve the manufacturing, testing and customer gaps faced by Silicon Valley’s tech industry players focused on transportation and mobility.
Mass production, particularly of automobiles and automobile technology, has proven difficult for California companies. Apple Inc. pulled out of making its own car, and Tesla Inc. has repeatedly missed its delivery targets for its lower-cost Model 3. California needs Michigan’s expertise, but at the dawn of a new age of mobility and technology, the auto industry can also benefit from the fast-paced nature and vitality of Silicon Valley’s technology stronghold.
“This was dreamt up by talking to industry, here in Detroit and in California,” said Trevor Pawl, group vice president of trade and procurement programs at the Michigan Economic Development Corp. The plan is his brainchild.
“We want to get Michigan companies involved in the valley and get those startups and tech companies there access to the end clients here,” Pawl said. “If we can connect them to Ford or Delphi or whomever, that means they’re more likely to invest and create jobs in Michigan.”
The MEDC and its partners will spend $250,000 in 2017 on sponsorships, creating “Shark Tank”-style events where California startups pitch Michigan’s auto players and, ultimately, set up a state economic development office in Silicon Valley. Additional funds will be spent on marketing the concept, Pawl said.
The state plans to become a sponsor of Santa Clara, Calif.-based processor maker Nvidia Corp.’s GPU Technology Conference in San Jose, Calif., in May. Planet M would be marketed and state economic agencies would be present, once a deal is reached, Pawl said. The conference attracts global scientists, engineers and entrepreneurs focused on artificial intelligence, virtual reality and driverless cars.
The goal of the initiative is to create or be involved in 12 events between Silicon Valley and Michigan.
Pawl said too often Michigan’s auto industry is used as the commercialization piece of the supply chain, losing out on the profitable aspects of innovation.
“We’ve spent years touting that we’re the auto capital, that we have 375 (research and development) centers,” Pawl said. “But what happens too often is a raw idea comes from, say, Japan, then to Silicon Valley for early-stage development, then to testing in Tennessee, then to Farmington Hills for validation. We’re the last stop on the innovation chain. We need to be stop number two. We need to be the innovation center.”
Farmington Hills-based Flextronics Automotive USA Inc., a subsidiary of Singapore technology conglomerate Flex Ltd., is already in discussions with the MEDC to get involved with the initiative. Flex is involved in 12 businesses, including a $2 billion automotive unit dedicated to autonomous, connected and electrification vehicle technology. Its U.S. headquarters is located in Silicon Valley. Flextronics employs 600 in Michigan and its customers include Ford, General Motors Co., Tata Technologies Inc., FCA US LLC, etc.
Chris Obey, president of Flextronics Automotive, speaking from the Consumer Electronics Show in Las Vegas last week, said Flextronics is often overlooked in the automotive conversation because its U.S. headquarters is in Silicon Valley, where automakers look more to Delphi Automotive plc and Robert Bosch LLC that have more established relationships.
“We’re trying to get recognized as a tier-one supplier in the auto sector, so being on top of a contact initiative like this is important,” Obey said. “We’re looking to continue to invest in the Detroit area, so we want to help bring our knowledge base in Silicon Valley to Detroit as it becomes a larger and larger tech zone and an autonomous vehicle center.”
Flex, and Flextronics, is the sort of multifaceted business Detroit wants to attract. Flex’s business lines include manufacturing of 80 percent of the world’s wearable devices, including all of the activity trackers for San Francisco-based Fitbit Inc. It supplies customers in the connected home, energy, server, storage and mobile fields.
“Speed is currency and the world is moving faster and faster, and we’re hoping to show Michigan’s auto sector how important it is to innovate at high speed,” Obey said. “We’re working with several local companies on autonomous projects, and we’re going to focus more of that work in Michigan. This initiative should help others to do more of the same.”
Glenn Stevens, executive director of the Detroit Regional Chamber’s MichAuto, an automotive advocacy group that works closely with the MEDC, said the auto companies are now technology companies, so aligning with the world’s greatest idea generators is important.
“A lot of these entrepreneurs have this perception that the traditional auto companies move slow,” Stevens said. “That’s just not true. With programs like this, we’re able to change this perception and show them how automotive is a real target market.”
Tim Yerdon, director of marketing and communications for Van Buren Township-based Visteon Corp. and chairman of MichAuto’s talent and retention committee, said getting products to market is now the auto industry’s greatest challenge.
“It’s all about how quickly we can get these new (automotive) functions to market,” Yerdon said. “Anything the state can do to expedite that is another feather in our cap and to the state and industry.”
Stevens said the Silicon Valley plan is the first in what he hopes will be a full expansion of the state’s economic prowess across the country.
“There’s real opportunity with the Valley, but not limited to just there,” Stevens said. “There’s opportunity in Austin or Boston or other parts of the world. It’s not just about accelerating something that’s happening today, but connecting those with these ideas all over the world with the consumers (Michigan auto companies) of that technology.”
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