Saturday, July 16, 2005

Chasing Canada

Trade trip offers Michigan chance to pick up Japanese business

By Kathy Barks Hoffman / Associated Press

Al Goldis/ Associated Press David Hollister, director of the Michigan Department of Labor and Economic Growth, is traveling to Japan this month on a trade trip with Gov. Jennifer Granholm. He said one goal of the trip is to persuade Toyota officials to consider building a new plant in Michigan. Comment on this story Send this story to a friend Get Home Delivery

LANSING - When David Hollister travels to Japan this month on a trade trip with Gov. Jennifer Granholm, he'll no doubt rely on lessons learned a decade ago as mayor of Lansing.

Hollister was just settling into his job as the city's new mayor when a top official from General Motors Corp. dropped by with devastating news.

Lansing's car assembly plant would shut down when GM decided to phase out the Oldsmobile Alero and other models. No new plant was envisioned for the city that gave birth to the Oldsmobile a century earlier.

"I was faced with the very real possibility of losing our No. 1 employer," recalls Hollister, now director of Michigan's Department of Labor and Economic Growth. "The people told me the odds of Lansing getting a GM plant were zero. Zero."

Instead of giving up, the longtime former legislator hit the phones. Soon, a blue-ribbon committee was hard at work convincing GM that the Lansing area _ with its well-trained work force, good labor relations and long automotive history _ was still a worthy place to make cars.

But the odds were stacked against them.

"There had not been a plant built north of the Mason-Dixon line in over 20 years," Hollister said. "They flat out told me it couldn't be done. And they gave me the same reasons _ taxes, work force, image, Rust Belt. You name it, I heard it."

In the end, however, Lansing prevailed. GM opened a luxury car plant downtown to build Cadillacs in January 2002, squeezing it in next to the existing plant, which GM shut down this spring.

Now, GM is building another plant in Delta Township just west of Lansing that will be able to produce multiple models at once _ a process known as flexible manufacturing. Although the economic downturn delayed the plant's construction, it's on target to open in 2006 and employ up to 3,000 workers.

Hollister says he plans to employ the same can-do attitude when he accompanies Granholm on a trade mission to Japan beginning July 22.

Although the trip won't be entirely focused on wooing automotive companies, Hollister said one goal is to persuade Toyota Motor Corp. officials to consider building a new plant in Michigan when they get ready to look for another North American site. Toyota recently chose Ontario for its latest North American facility and is expected to expand on the continent again in the coming years as sales continue to grow.

"I think there's a very good likelihood we can land it," Hollister said. "If I didn't think that, I wouldn't be going."

Granholm says the state has lots of selling points for Toyota and others in the auto industry: an experienced work force, clusters of automotive manufacturers and suppliers, a growing research and development sector and the prospect of a deal between Granholm and legislators to lower taxes for businesses.

Then-Toyota President Fujio Cho said in January his company was open to Michigan's overtures.

"We already have a presence in Michigan and would be open to other opportunities in the future," Dennis Cuneo, senior vice president for Toyota Motor North America, told The Associated Press recently. "Ten years ago, we would have said, `Unlikely,' but things have changed."

Michigan is increasingly turning to foreign automakers and suppliers as Detroit's Big Three _ GM, Ford Motor Co. and DaimlerChrysler AG's Chrysler Group _ downsize and lose market share in an increasingly global marketplace.

Last November, Granholm traveled to Germany to invite German manufacturers to build or expand in Michigan. Karmann Manufacturing was among those that responded, opening a new plant last month to build parts for the new Pontiac G6 convertible in Plymouth Township.

David Cole, chairman of the Center for Automotive Research in Ann Arbor, applauded Granholm for her efforts.

"Doing these things as the leader of the state is very important," he said. "What the governor understands is, it's all about building relationships. And she's very good at that."

On the Net:

Michigan Department of Labor and Economic Growth: http://www.michigan.gov/dleg

Toyota Motor Corp.: http://www.toyota.com/

The Center for Automotive Research: http://www.cargroup.org/