Economic development leaders from across the United States have begun to recognize the growing number of opportunities available through partnerships with automotive manufacturers. These new options are a direct result of several emerging trends in the sector such as the shift towards value-added manufacturing in the United States, growth prospects from non-US industry participants and the emergence of new industry segments including alternative energy technologies.
Market forces are driving manufacturing executives to move commodity production to lowest overall cost nations and to retain value-added manufacturing in the United States. Economic developers can address this trend by cultivating solid relationships with plant personnel and making continuous efforts toward workforce development and job training to upgrade worker skills in advance of production shifts. Cooperation with flexible, open-minded and creative labor leaders can also greatly enhance community efforts to retain and attract automotive industry business.
Non-US-based automakers are clamoring to gain access to US markets. Greg Burkart, of counsel with Squire Sanders in Detroit, notes that Nanjing Automotive, a China-based car manufacturer, has agreed to build a plant, headquarters and engineering facility in Oklahoma. “This is not unusual,” Burkart states. “A number of Asian and European automakers and suppliers are looking to establish a US-based market presence through plants and distribution or logistics centers. These companies are looking for the right combination of incentives, location and workforce.”
In addition, investment in emerging technologies like alternative fuel vehicles and power sources can lead to economic growth. With the lack of a dominant technology, more than 4,000 firms are vying for market share, development dollars and skilled workers. These firms are eager for the opportunity for expansion and growth. Collaboration with local resources such as universities, national laboratories and other companies can be a viable strategy to attract these high-tech companies.
Burkart, who recently gave a speech to the Southern Economic Development Conference on automotive trends, observes, “When thinking about opportunities in the automotive industry, economic developers need to move beyond any outdated notions they may have had. There are a number of strong, emerging trends to be explored that could significantly impact a community. It is critical to look beyond the Big Three and Japan.”