Opinion | Rick Snyder: Here’s how Michigan wins the next Ford auto plant
Michigan just sent $6 billion in economic development to Kentucky and Tennessee. Something about that doesn’t sound right, does it? It should be a shocking wake-up call to all Michiganders to watch Dearborn-based Ford Motor Co. with its partner choose another state for a major, new future business development initiative rather than its long-time home.
The future of mobility is the electric automobile. That’s why it is deeply troubling that Ford is planning to build not just one, but three electric-vehicle battery factories and an auto assembly plant in other states. More than 10,000 jobs are now being created somewhere other than Michigan.
The damage to Michigan is actually much larger than this current wave of Ford jobs moving south. The transition to electric vehicles requires less traditional auto content. Building the battery plants near the assembly plants in these southern locations is a sign that our supply chain here is in for a rough time over the next decade and longer.
What upsets me is that Michigan was not even a contender. Not being considered for this project is a huge loss to our state. The Michigan Legislature should immediately hold public hearings to learn not just what went wrong, but how we can prevent this from happening again.
I don’t blame Ford. It is a global corporation that has to be competitive. In addition, Ford has made major investments in Michigan, including its headquarters campus here. Ford isn’t the problem; we are the problem because Michigan was not seen as being competitive enough.
So, let’s take action. We need a new approach to economic development, starting with an urgent, bipartisan and inclusive dialogue to address our challenges.
As a business leader and investor, here’s the feedback I would give to such a committee:
1. Good economic development requires consistent, long-term public policy strategies and execution, ideally in the 10- to 20-year timeframe. Our planning has been too exposed to the whims of political cycles that are short term. Partisanship in economic development leads to uncertainty, which is bad for investors. Michigan fails on this point.
2. Great economic development is a team sport. It requires an inclusive, public-private partnership of government, education, real estate, communications, utilities, and more. It needs all hands on deck working together. Michigan is weak on this point.
3. The leadership of our economic development initiatives needs to understand and know how business leaders make decisions. Most politicians are weak to average on business issues. Dedicated professionals are needed. Michigan is very weak on this point.
4. Having a pool of qualified talent available to work is critical. The most important item for long-term business success is having a highly skilled workforce. For manufacturing companies, our nation doesn’t have a very good system of developing the technical talent needed for the factory floor of today and the future. Other nations such as Germany and Switzerland are much better at developing this critical talent pipeline. Michigan is above the American average but poor compared to the world’s best. We must do better.
5. Good infrastructure to support business expansion is critically important. This includes land, utilities, roads, and technology. Having this infrastructure ready to go versus waiting for years often is a deciding factor for companies since they can’t deal with uncertain timelines in their disciplined planning processes. Michigan is currently very weak on having site-ready locations.
6. Taxes and regulations make a difference in business location decisions. Businesses are traditionally looking for lower and fewer as a guide. But local jurisdictions need to offer good services and quality of life for their operation and employees. It is important to evaluate these interests and have long-term consistent policies and practices which create a level playing field. Michigan used to be better; but its practices have moved in a negative direction.
7. Incentives are usually the most talked about item, but not the most important. In large scale situations, support or job training and infrastructure will likely be necessary. Otherwise, it is best to avoid them. Michigan should update its tools here in a focused fashion.
8. We have learned that businesses only want to grow in places where people get along and work together in a collaborative fashion. The fastest way to scare someone away is for them to see us fighting amongst ourselves. Michigan fails on this point.
Every sports team looks at the game films after a loss to see what went wrong and how they can improve. The list above shows that Michigan has a lot of work to be done to become highly competitive again. It is time for an honest assessment. We must do so to set a clear vision and pursue aggressive collaborative action.
As governor, my administration made significant progress on economic development. The state’s business climate was ranked 41st in 2009 with unemployment at 14.9 percent. But we took bold, deliberate steps to boost that rating to 7th by 2017 resulting in an unemployment rate of 4.6 percent.
Michigan put the world on wheels. We were the Arsenal of Democracy. And now we can be the center of mobility. But only if we take action together to prepare for the future before we lose one more job to another state.
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