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Toyota opens technical center: $187-million York Twp. site seen as economic boon

Fri. October 10, 2008; Posted: 12:10 PM
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Oct 10, 2008 (Detroit Free Press - McClatchy-Tribune Information Services via COMTEX) -- TM | Quote | Chart | News | PowerRating -- Toyota held a grand opening celebration Thursday for its new $187-million technical center in York Township that was hailed as a major economic development project for the state by Gov. Jennifer Granholm as Toyota and the automotive industry struggle through the most difficult conditions since at least the early 1990s.

Toyota's 700-acre technical center, at the northwest corner of U.S.-23 and Willis Road in York Township south of Ann Arbor, expands the company's vehicle engineering and development capability, represents additional opportunities for local suppliers and secures hundreds of high-wage jobs for the state.

"It is this celebration of investment and jobs in Michigan that we are here to raise a glass to," Granholm said. "These are tough times in the industry, but we also know that the vehicle as a product and its evolution is all going to happen right here in Michigan."

But getting to this point was painful at times. It took an act of the state Legislature in 2004 for Michigan to sell the land to Toyota for $11 million. It also required a ruling in the state's favor by the Michigan Supreme Court in 2006 after a real estate developer offered $25.3 million for the land and sued.

And, the state granted Toyota a $38.9-million tax credit through the Michigan Economic Growth Authority.

But York Township Supervisor Joe Zurawski said the land was targeted for research and development in a township planning document 20 years ago. Several projects were proposed but didn't work.

"This project by far is the best of them," Zurawski said. "It is more than we could have hoped for."

While about 500 employees work in York Township, Toyota continues to occupy its research and development campus in Ann Arbor Township and plans to employ 1,100 in the region by 2010. That center has played a key role in the development of the Tundra pickup, Camry Solara, Sienna minivan and Venza crossover.

Yasuhiko Ichihashi, senior managing director of Toyota Motor Corp., said that vehicle development role will increase because the new engineering center boosts Toyota's capability in Michigan.

"Since 1972, Toyota has grown step by step in Michigan," Ichihashi said.

Toyota's expansion boosts opportunities for U.S.-based suppliers. The new center has workspace where suppliers collaborate on engineering and design work with Toyota. In addition to Toyota employees, about 200 supplier employees, contract and temporary workers already work at the York Township building.

"The 'design-in' centers are used in Japan," said Dave Andrea, vice president of business development for the Original Equipment Suppliers Association. "So, it speaks to Toyota's efforts to standardize their practices globally, and it speaks to the capabilities of the North American supply base that Toyota is localizing more of its design and engineering work here."

Although Toyota executives and Michigan economic officials celebrated Thursday, they also acknowledged that these are tough times.

Toyota's sales plunged 32.3% in the United States in September as industry sales sank 26.6%. Last week Toyota unveiled an unprecedented 0% interest rate on eleven 2008 and 2009 Toyota-brand models for up to five years, including Camry and Corolla, its two top sellers.

Jim Lentz, president of Toyota Motor Sales USA, said it is too early to tell whether the program is going to be effective this month.

Lentz said Toyota is not having difficulty getting loans and leases approved for customers, but is having a hard time generating showroom traffic.

"In our case, credit is not the problem," Lentz said. "The biggest problem is consumer confidence."

Contact BRENT SNAVELY at 313-222-6512 or bsnavely@freepress.com.

To see more of the Detroit Free Press, or to subscribe to the newspaper, go to http://www.freep.com Copyright (c) 2008, Detroit Free Press Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.

For full details on Toyota Motor Corporation ADS (TM) click here. Toyota Motor Corporation ADS (TM) has Short Term PowerRatings of 6. Details on Toyota Motor Corporation ADS (TM) Short Term PowerRatings is available at This Link.

    


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