MICHauto

Michigan automotive industry


Clemens Food Group.Southwest Michigan’s manufacturing industry has clipped along at a moderate but steady growth rate throughout the last 12 months.

That growth in Kalamazoo and Battle Creek was buoyed because of the broadening automotive business, a trend that’s played in many years following the depths of recession. But while experts believe a is largely on course for more many years of record production, regional officials including Southwest Michigan very first CEO Ron Kitchens think the region’s reliance on the automotive industry might be cause of issue.

Kitchens would like to see even more diversification among manufacturers in Southwest Michigan.

“(the existing development) is good, but it’s only a little scary because when auto declined, we saw most companies focus on diversification of item, ” Kitchens stated. “Well, there isn’t the margins and amount that there was in automobile and thus they’ve form of dumped their particular diversification programs and they’ve gone returning to the medicine that's auto.”

While the automotive industry catalyzed growth for production industry in Southwest Michigan, there’s small research pointing to an amazing downturn in the near future, stated Mark D’Amato, director of regional economic planning solutions during the W.E. Upjohn Institute for work analysis. That’s mainly due to the powerful perspective for car makers, combined with lessons in performance discovered by manufacturers in the recession many years, he stated.

North American automotive manufacturing is slated to achieve 17.5 million units by 2017 and might top 19 million units by 2022, relating to data from IHS Automotive.

“In Southwest Michigan, automotive production can be an integral an element of the development pattern because they are such high value-add and since they are such a large export industry, ” D’Amato said. “It truly escalates the output of region.”

But automotive is definately not the only Southwest Michigan manufacturing industry that’s broadening, D’Amato said. A small number of various other sectors, including businesses when you look at the life sciences, pharmaceutical and medical product manufacturing sectors, have cultivated in the higher Kalamazoo area. Those tend to be business groups D’Amato believes will end up “significant motorists” for area into the impending years.

In general, manufacturing work in Kalamazoo expanded to 20, 720 in the first quarter of 2015, a 2.3-percent boost from first one-fourth of 2014, in accordance with information through the Upjohn Institute. In Battle Creek, production work stood at 11, 500, up nearly 4 per cent from exact same duration last year.

Kitchens said producing production variation in your community can come by developing a labor share of employees with technical abilities that can be exercised in several industries. To do that, Southwest Michigan First has actually advanced its “middle-college” effort, which provides one more year of education after high-school that leads to an associate’s level in a technical ability that is perhaps not specific towards the automotive industry.

FOOD-PROCESSING SLUMP?

Compared to the quickly growing automotive sector, the food processing business features stagnated in Southwest Michigan over the last year, D’Amato said. Specifically, Battle Creek-based Kellogg Co.’s decision to transfer 300 to 600 workers to its home based business solutions center in Grand Rapids has actually D’Amato worried about the potency of that business in the years ahead.

“Food processing really took a huge hit in the last year, ” D’Amato stated. “It’s the story of one industry developing (auto) plus one sort of wilting (food-processing).”

While Kellogg (NYSE: K) are on pause the minute, various other meals processors tend to be needs to just take a renewed glance at the area, Kitchens stated. He pointed to Clemens Food Group’s brand-new chicken processing center in Coldwater for example of a food processor that “brought that industry back in our state.”

For their part, Kitchens plans to consistently court food processing companies to Southwest Michigan, especially those in western says which are experiencing persistent water shortages.



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