May 25, 2016 Updated 5/25/2016
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John Irwin
Automotive News
Flex-N-Gate Corp. The new Flex-N-Gate Corp. plant will include injection molding, although the company has not disclosed any details.
Executives from two NFL football franchises — Bill Ford of the Detroit Lions and Shahid Khan of the Jacksonville Jaguars — played key roles in bringing a top-tier auto parts plant to Detroit.
Flex-N-Gate Corp. said May 25 it will invest $ 95 million in a facility on a vacant, 30-acre site in Detroit that will supply Ford Motor Co. Flex-N-Gate did not disclose which parts it will produce for the automaker.
The company makes a variety of body and chassis structural assemblies, full bumper and fascia systems, brackets and other products for automakers. The Detroit facility will include plastic injection molding operations, the scope of which is yet to be determined, a spokesman said.
The Urbana, Ill., company, which received a $ 3.5 million performance-based state grant for the project, said the plant will create up to 650 jobs over three years.
Khan, Flex-N-Gate’s owner, said Ford Executive Chairman Bill Ford was the “No. 1 guy” in facilitating the move. Ford is also vice chairman of the Lions, owned by the Ford family.
“I think it started with him,” Khan said following a news conference in Detroit.
Phil Nussel/Automotive News Flex-N-Gate owner Shahid Khan, left, and Detroit Mayor Michael Duggan.
Khan, who has owned the Jaguars since 2011 and also owns a European soccer franchise, said Ford’s push for a Detroit Flex-N-Gate plant showed the “power of football.”
Ford told Khan he “wants some real development, [to] create some jobs,” Khan said. “Ford Motor Co. is not a charitable institution. Let’s not confuse that. They want to do the right thing for their shareholders and stakeholders. But it’s like, you could do it and still serve everybody and create good jobs and economic progress in the process.”
Detroit Mayor Mike Duggan also credited Bill Ford for his role in bringing Flex-N-Gate to the city.
“Bill Ford intervened on this personally,” Duggan said. “You had the advantage of a couple owners of NFL teams, I think, talking to each other. … It was Ford who came forward first to our team last December and said, ‘I think there’s a chance to get a Flex-N-Gate plant in Detroit.’”
Duggan also thanked UAW Vice President Jimmy Settles for pushing the project “from the beginning.” It was not immediately clear what specific role Settles or the UAW had in pushing the project.
It is not yet known whether the UAW will pursue unionization at the Flex-N-Gate facility. The union has tried over the years to organize various Flex-N-Gate operations, but with little success. Settles was not seen at today’s announcement, and the UAW so far has not commented on the project.
“Those are decisions, really, our employees have to make,” Khan said. “It will be up to them, whatever they choose, and it’s our duty, obviously, to respect that.”
Khan said the plant would offer wages, including benefits, in the mid- to high $ 20 per hour range.
“We expect to have good-paying jobs in this town, and the locals will decide for themselves what to do,” Duggan said.
Duggan said the city has been in talks with the Detroit 3 automakers and major Tier 1 suppliers about how to bring suppliers into the city. Detroit and other American municipalities have been competing for manufacturing jobs with Mexico, where low wage costs make the country more attractive to some companies.
“We’ve talked to most of the major Tier 1 suppliers in southeastern Michigan, and we’re just looking at what parts are coming next, what plants are coming next and where the opportunities are,” Duggan said. “And we just want to say, ‘If you’ve got a choice between Juarez and Detroit, we’ve got transportation advantages, and we’ve got some other advantages. They may have the labor wage advantage, but can we make the overall package competitive?’”
The Michigan Strategic Fund on May 24 approved the $ 3.5 million grant for the project to help the company with brownfield development costs. Flex-N-Gate will remediate the brownfield site, which will cost $ 1.3 million, and will qualify for a tax credit. The Michigan Economic Development Corp. will apply for a property tax reimbursement. Building on a brownfield site is costlier a more costly procedure than building on a greenfield site or a site with existing buildings, according to an MEDC memo.
MEDC and the city will recommend approval of a Renaissance Zone for the new operation.
Flex-N-Gate and its subsidiary Ventra, a plastic bumper fascia specialist, have 11 plants and one research center in Michigan. The company has 48 manufacturing and nine product development and engineering facilities throughout the U.S., Canada, Argentina, Brazil, Mexico, China and Spain.
Flex-N-Gate ranks No. 46 on Automotive News’ list of the top 100 global parts suppliers, with automotive parts sales of $ 5.1 billion in 2014.
The news might make the Detroit Lions’ Nov. 20 game this fall a little more interesting. The team is hosting the Jaguars at Ford Field in Detroit. There was no word on whether Khan will be invited to watch the game with the Fords.
Kerri Jansen of Plastics News, and Crain’s Detroit Business, contributed to this report.
