Book of Deals Update 2017

Book of Deals Update 2017

Bernard Swiecki, Director, ACP bswiecki@ (734) 929-0484

Page | 1

TABLE OF CONTENTS Methodology........................................................................................................................................................ 3 Purpose............................................................................................................................................................ 3 Coverage.......................................................................................................................................................... 3 Executive Summary .............................................................................................................................................. 3 Regional Breakdown, 2017 ................................................................................................................................... 4 Top Ten Significant Announcements for 2017 ...................................................................................................... 6 2017 Announced Investments by Automakers ..................................................................................................... 7 FCA .................................................................................................................................................................. 7 Ford ................................................................................................................................................................. 7 GM................................................................................................................................................................... 8 Honda .............................................................................................................................................................. 8 Hyundai-Kia...................................................................................................................................................... 9 Mercedes-Benz ................................................................................................................................................ 9 Nissan ............................................................................................................................................................ 10 Toyota............................................................................................................................................................ 10 VW................................................................................................................................................................. 11 Volvo.............................................................................................................................................................. 11 Historical Trends ? 2009 to 2017 ........................................................................................................................ 13 Recent Announcements ..................................................................................................................................... 15 Appendix: December 2017 Announcements....................................................................................................... 16

Page | 2

METHODOLOGY

PURPOSE The Center for Automotive Research Book of Deals was created in 2003 to track economic development deals between automotive companies and state governments. Today, The Book of Deals functions as an inventory of North American investment projects, as announced by automakers and automotive suppliers. To populate the Book of Deals, CAR monitors news, governmental, and company sources on an ongoing basis.

COVERAGE The Book of Deals tracks announced investments occurring in the United States, Canada, and Mexico. Capital investments, such as the establishment of a new office, installation of new machinery, and the expansion of an assembly line, are included. Corporate mergers and acquisitions, changes to employment levels, and investment activity from related industries (agricultural vehicles, construction equipment, aftermarket parts) are not recorded in the Book of Deals. The Book of Deals is based on publically available data. Announcements of lesser value, particularly those from smaller supplier firms, may therefore not be included. Please note, this annual update is based solely on publically announced automaker announcements for 2017.

EXECUTIVE SUMMARY For 2017, there were 63 new automaker investment projects announced for a total investment of roughly $11.2 billion with over 24,000 jobs announced. Over 9,000 new jobs were announced in 2017. Of these 63 investments, there were 27 expansions to existing facilities, 9 retooling in facilities, and 27 new facilities. Throughout 2017, details from the 2015 UAW contracts have begun to emerge. There have been fewer than 10 investments by FCA, Ford, and GM this year. However, these investments are not included in the 2017 announcement totals because the original announcements happened during UAW contract negotiations in 2015. The largest announcement this year was by VW. The company announced it would spend a total of $2 billion across the U.S. as a part of its diesel emissions settlement case with the U.S. government. This investment will go towards clean car infrastructure. $800 million of the investment will be going to California. Please see Table 1 for the top ten automakers investments of 2017. Of publically released incentives, over $894 million was offered to 12 automaker announcements in 2017. Incentive details are available for: Toyota - Long Beach, CA; American Haval Motor Technology LLC; Toyota/Honda with Shell - San Francisco, CA; Proterra; Navya; FCA - Bedford Twp., MI; GM - Arlington, TX; GM - San Francisco, CA; Honda - Lincoln, AL; Ford - ON, Canada; AM General and Toyota-Mazda ? Huntsville, AL.

Page | 3

REGIONAL BREAKDOWN, 2017 Figure 1: North American Automaker Announced Investment, 2017

$0.8B

$10.2B

$0.2B

Canada ? As shown in Figure 1, over $779 million or roughly 7 percent of North American automaker investment went to Canada ? about 6 investments were made in 2017. Approximately 52 percent of investment into Canada was new investments as opposed to reinvestments into the country. Investments went into new distribution centers, a new R&D facility for connected car development, a new electric vehicle assembly plant in Ontario, as well as new electric vehicle infrastructure, and re-investment in an assembly plant. Throughout 2017, automakers announced plans to create or retain over 600 jobs in Canada. Mexico ? There were 3 automaker announcements in Mexico during 2017, totaling $208 million or roughly 2 percent of North American automaker investment. Only 28 percent of investment in Mexico went towards new investments as opposed to 72 percent being reinvestments in the country. All of the investments were allocated to assembly plants ? two new facilities were announced by BAIC and Zacua. Also, reinvestment was announced for Kia's assembly plant in Nuevo Leon. In 2017, 314 new jobs were announced.

Page | 4

United States ? In total, automakers announced plans to invest over $10.2 billion into the United States, accounting for 91 percent of North American investment for 2017. Over 50 announcements were made with about 40 percent allocated to new investments. The majority of these new investments will go towards clean car infrastructure and manufacturing facilities. Roughly 77 percent of all investments in the United States went to manufacturing facilities. Other investments across the United States went towards administrative offices (0.1 percent), R&D facilities (3.3 percent), and other (19.6 percent). About 23,000 jobs were created or retained in the United States by automakers. Figure 2: Share of North American Investment, 2017

Mexico Canada United States 1.9% 6.9%

91.2%

U.S. Regional Analysis o Great Lakes Region ? This region is composed of Indiana, Illinois, Michigan, Missouri, Ohio, and Kentucky. In total for 2017, automakers invested over $3.7 billion and created or retained over 8,400 jobs throughout these states. The largest investment in this region was Toyota's expansion to its assembly plant in Georgetown, Kentucky ($1.3 billion). Kentucky received the largest amount of investment for the Great Lakes Region, roughly $1.5 billion. o South ? This region is composed of Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, and Texas. Overall, automakers invested about $4.3 billion and created or retained over 10,700 jobs in this region. The largest investment announced in the south was made by the Toyota-Mazda joint venture. In August 2017, these companies announced plans to invest $1.6 billion into a new facility creating 4,000 jobs. Early January, the companies announced the assembly plant will be located in Huntsville, Alabama and will receive about $700 million in incentives. Alabama received the largest amount of investment in 2017, $2.9 billion, compared to the other states across the U.S.

Page | 5

 ................
................

In order to avoid copyright disputes, this page is only a partial summary.

Google Online Preview   Download