A million-dollar new economic development grant could support up 2,200 new jobs in Detroit, thanks to state and local grants funded by taxpayers.
The Michigan Department of Transportation (MDOT) grant seeks to fund infrastructure improvements around General Motors’ Factory ZERO plant near the Detroit-Hamtramck border.
“This is good news for our families, our businesses, and our economy as a whole. Every Michigander deserves to drive on our roads safely, without blowing a tire or cracking a windshield, and this partnership with GM will help us reach that goal while creating good jobs for Michigan workers,” Gov. Gretchen Whitmer said in a statement.
Michael LaFaive, the Mackinac Center’s senior director of fiscal policy, is more skeptical of the investment. In an email to The Center Square, LaFaive said when the state chooses marketplace winners and losers, taxpayers often lose.
“The road to prosperity is not paved with selective subsidies,” LaFaive wrote. “Quality road infrastructure often makes a sound investment, but this is tied to a private, for-profit project state planners believe is more worthy than others. The record on state targeted economic development projects is not a positive one as has been demonstrated by scholarly research.”
General Motors (GM) is investing $2.2 billion in Factory ZERO, reconfiguring the Detroit-Hamtramck Assembly Center to an all-electric vehicle assembly plant. The automaker was concerned the surrounding infrastructure and roads could damage parts and delivery trucks.
GM builds and and sells vehicles worldwide including Chevrolet, Buick, GMC, and Cadillac.
The automaker recently announced that 40% of its U.S. entries will be battery electric vehicles by the end of 2025.
GM has developed a new battery pack technology the reduces costs by nearly 40% compared to the Chevrolet Bolt Electric Vehicle (EV), GM spokesperson Chad Lyons told The Center Square in an email.
“GM is projecting that second-generation Ultium packs, expected mid-decade, will cost 60% less than the batteries in use today with twice the energy density expected,” Lyons wrote, adding that the first generation of GM’s future EV program are expected to be profitable.
Factory ZERO plant director Jim Quick said they appreciated the investment.
“General Motors appreciates the support from MDOT and the City of Detroit for these much-needed road improvements,” Quick said in a statement. “Factory ZERO is an important piece of our journey to an all-electric future and these road improvements will greatly help our employees and the community as we prepare to build electric trucks and the Cruise Origin.”
Work partly funded by this grant will rebuild and repave with concrete the following stretches of road:
The total project cost is $11.6 million.
The Transportation Economic Development Fund (TED) Category A share of the project is $6 million, which helps finance highway, city and village road projects.
The city of Detroit is providing $5.6 million in matching funds, which will also rebuild some sidewalks.
Eligible road agencies for TED A include MDOT, county road commissions, cities, and villages.
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