No Slowdown In Sight

With its rich automotive heritage, Michigan’s SOAR Fund is helping to attract electric vehicle makers and more.

By Anne Cosgrove
From the January / February 2023 Issue

In October 2022, Governor Gretchen Whitmer along with the Michigan Economic Development Corporation (MEDC) announced the Michigan Strategic Fund had approved three significant projects in two very different industries—electric vehicles (EV) and agriculture. A common thread was that these projects were moving forward with assistance from the state’s SOAR Fund. Created to support two programs signed into law by Gov. Whitmer in December 2021—the Strategic Site Readiness Program (SSRP) and the Critical Industry Program (CIP), SOAR launched with funding of $1 billion; more than $500 million was added in late 2022. Under SOAR, all projects are required for approval by the Michigan Strategic Fund Board, headed by Quentin Messer, Jr., MEDC CEO and Michigan Strategic Fund President and Chair.

Those three projects highlighted back in October represent a capital investment of over $4.1 billion and the creation of more than 4,600 new direct jobs.

The SOAR-funded project for the agriculture sector is an infrastructure improvement plan in the western part of the state. Muskegon County was awarded a $60 million SSRP performance-based grant for the Southeast Regional Force Main project impacting Ottawa and Muskegon Counties. The project intends to provide wastewater transport and disposal services for area agriculture companies including Fairlife, Continental Dairy, DeVries Meats, Applegate Dairy, and Swanson Pickle which plan to invest at least $187 million and create 145 jobs upon completion of the project.

In February 2022, Michigan awarded a contract to Electreon to build a public wireless in-road charging system for electric vehicles on a one-mile section of road in Detroit. (Photo: Michigan Economic Development Corp.)

“Fairlife has been a proud part of the West Michigan community for more than a decade, and the teamwork and commitment to bettering the community demonstrated in this project is a testament to the continued opportunity here for all of us,” said Tim Doelman, CEO, Fairlife LLC.

The EV industry companies highlighted by Gov. Whitmer in October are battery manufacturers: Our Next Energy (ONE) in Van Buren Township, and Gotion, Inc. in Big Rapids.

Michigan-based ONE announced a $1.6 billion investment in a new battery cell manufacturing plant (dubbed ONE Circle), with 2,100+ jobs to be created. Meanwhile, Gotion, Inc. (subsidiary of China Based Gotion High-Tech Co., Ltd) is building a battery manufacturing facility expected to generate a total capital investment of more than $2.36 billion and up to 2,350 jobs.

ONE and Gotion were the latest in a string of new and expanding EV and related companies choosing to locate in Michigan. Traditional auto manufacturers expanding into the EV market are among the central players in the industry landscape. In January 2022, GM announced it would invest $7 billion to convert an existing Orion Township assembly plant to build full-size EV pickups, as well as building a battery cell plant in Lansing. Adding to its Michigan workforce of 50,000, GM is looking to the state’s manufacturing and engineering talent for 4,000 new jobs that “will help us make our home state the epicenter of the electric vehicle industry,” said GM CEO Mary Barra.

In June, Ford Motor Company announced plans to invest $2 billion in its various plants throughout southeast Michigan, creating more than 3,200 manufacturing jobs.

Relocating and expanding battery component manufacturers, chip manufacturers, and a bevy of other supplier types are strengthening the pipeline for the EV industry in Michigan. These include LG Energy Solution (LGES) which announced a $1.7 billion investment in March 2022 to quintuple it plant capacity in Holland. Since 2010 the company has had a presence there when it chose Michigan for its first EV battery plant in the United States.

Other firms growing the industry here include automotive technology manufacturer Lear Corporation expanding existing operations in Independence Township, Traverse City, and Sterling Heights. Lear is planning to manufacture PACE Award-winning Battery Disconnect Units and other vehicle electrification sub-systems for advanced batteries for supply to automakers. Lear plans to utilize its Independence Township facility to manufacture these components; the plant is slated to start production in early 2024 The company will also expand its Traverse City and Sterling Heights facilities for production of EV related components.

Meanwhile, safety science leader UL LLC, a subsidiary of Underwriters Laboratories, Inc., plans to build a testing facility in Auburn Hills where it will focus on a long-term strategy to support battery manufacturers by increasing the safety and reliability of energy storage products. The project is expected to generate a total capital investment of $72.7 million and create 61 jobs, supported by a $1.5 million in grants from the state.

As the EV and autonomous vehicle (AV) industries gain momentum against the backdrop of evolving transportation and mobility challenges of the 21st century, Michigan government recognizes the burgeoning shifts. Last September, the state’s Office of Future Mobility and Electrification launched the first state strategy for future mobility, the MI Future Mobility Plan, along with other state agencies. Two of the plan’s three pillars focus on EV infrastructure and related issues.

Announcing the plan, Gov. Whitmer commented: “Since I took office [in 2019], we have announced 25,000 good-paying auto jobs and multi-billion-dollar investments from world-leading companies in electric vehicles, chips, and batteries. We have the momentum, and this plan will help us keep moving forward.”

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