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Area Development - Site Selection, Facility Planning and Workforce Development

Nexteer Automotive Plans $70 million Investment in Saginaw, Michigan, Manufacturing Plant

12/17/2012
Nexteer Automotive, a tier one automotive supplier committed exclusively to wheel-to-wheel advanced steering and driveline systems, will make a nearly $70 million investment at its world headquarters in Saginaw, Michigan, with plans to add 325 new jobs.

A new customer contract with a major North American automaker is the driving force behind this new investment and expansion. The contract is for Nexteer’s advanced 12-volt rack electric power steering system, the company said.

“With our continued focus on innovation and customer focused steering solutions, Nexteer continues to diversify its customer base and secure significant EPS bookings,” said Laurent Bresson, president and chief operating officer at Nexteer. “Rapid adaption of electric power steering is a direct result of automakers striving to meet new fuel economy regulations and EPS enables up to a six percent improvement along with numerous driver assist benefits.”

The nearly $70 million investment will be spent throughout 2014 to upgrade and expand Nexteer’s development, manufacturing and test capabilities. This includes modernizing the plant infrastructure and investing in high-tech, new manufacturing machinery and equipment.

“The new EPS contract was sourced to our Saginaw operations for two key reasons; first, we have a cost-competitive operation and footprint,” added Bresson. “Second, EPS systems are very complex components that require advanced manufacturing processes, and the team in Saginaw has demonstrated its ability to achieve high quality levels.”

Nexteer is the only steering supplier to provide 12-volt EPS across a full range of vehicle segments, sizes and classes, from compact cars to full-size trucks. The company’s 12-volt system was an industry breakthrough and has led to record new business bookings over the past couple years. By the end of 2014, 90 percent of newly produced North American full-size trucks will be equipped with Nexteer’s 12-volt EPS systems. Through its in-house electronics design and validation, Nexteer has the ability to personalize its EPS systems to automakers’ unique brand DNA.

“Nexteer’s strong relationships and close collaboration with the UAW, community leaders and local and state government have allowed the Saginaw site to remain competitive and be in a position to secure this new customer contract,” said Mike Gannon, chief operating officer of the Saginaw Division, senior vice president and chief human resources officer for Nexteer. “These contracts run through 2022 and provide long-term security and stability for the Saginaw site.”

Last October Nexteer announced plans for a $150 million investment and new long-term contract with General Motors for the company’s next-generation full-size truck program, which resulted in the retention of more than 1,000 jobs at the Saginaw site.

“There is a culture of high-performance and dedication to excellence at Nexteer,” added Bresson. “The hard work is paying off and these unique skill sets have led to Nexteer designing and manufacturing the industry’s most advanced steering and driveline systems.”

An an incentive the Michigan Economic Development Corporation and the state’s Strategic Fund approved an extension to a package of tax credits granted to the firm, earlier, to spark job creation.

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