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ABB 2004/5 | US States > Mid West Region > Michigan

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Michigan

Taking on the world

With its incentives and tax credits, companies are finding business-friendly Michigan the ideal location to move onwards and upwards

Why should a British-based company locate operations in Michigan? The fact that Michigan is surrounded by four of the five Great Lakes will certainly help a British corporate family feel right at home! But aside from the exceptional natural resources, and cultural and recreational amenities, Michigan is attracting the attention of UK-based companies for some very sound business reasons.

With incentives that make a real difference to the bottom line, a highly skilled labour force, easy access to customers and suppliers, excellent transportation links and world-class university and research capability, Michigan offers the essentials that businesses need. According to Site Selection magazine, Michigan has attracted more corporate facilities and expansions over the past seven years than
any other US state. In fact, Michigan has gained over 2,000 such projects more than California, our closest competitor. A business-friendly climate that includes recent regulatory reforms, a streamlined permitting process and revolutionary tax incentives make Michigan an ideal choice for locating a growing business.

Our international partners apparently agree. The Great Lakes State is home to more than 1,000 divisions, affiliates and subsidiaries of international companies, including more than 60 that are UK-based. On the investment side, Michigan cities are recognised as top magnets for European business. Expansion Management magazine’s fifth annual survey of European capital investment in the US
manufacturing sector ranked Michigan second. Nearly 30 European companies have invested in the Detroit-Warren- Livonia metro area alone during the past two years.

Of the Top 150 suppliers to North America identified by Automotive News for 2003, 86 are located in Michigan. Outsourcing by the automakers has opened up greater opportunities for Tier One and Two suppliers. Michigan has also won the brains of the automotive industry. In the past 30 months, Michigan has welcomed a new influx of automotive R&D, testing, engineering facilities and expansions of companies that include BorgWarner, Toyota, Hyundai, Nissan, Akebono and Saab.

A recent high-tech addition, characteristic of the increasing diversification of the state’s economy, is the new laboratory complex for British-based Smiths Aerospace in Grand Rapids. At this new facility, the company is creating and testing advanced avionics equipment and components for future US and British military aircraft. The British-owned aerospace giant has its electronic systems headquarters
in Grand Rapids, but had considered expanding into a competing site in Maryland. However, the Michigan Economic Development Corporation (MEDC) offered Smiths a high-tech Single Business Tax credit worth $2.1m over the next nine years to help convince the company to expand locally.

Homeland security, along with life sciences and advanced automotive technologies, is being targeted for growth through the Michigan Technology Tri-Corridor initiative. The Tri-Corridor is Governor Granholm’s plan for leveraging Michigan’s manufacturing and research capabilities in these three high-tech, high-growth sectors. The state has gained more than 100 new high-tech life sciences companies
over the past four years. It already has more than 1,000 companies in advanced automotive technologies, and more than 100 pursuing development of security technologies.

Michigan is noted for its innovative incentives, designed to attract and grow companies here. The Michigan Economic Development Corporation has the ability to offer tax-free Renaissance Zones, state tax abatement, and credits and other incentives for new and growing companies. Michigan’s brownfield redevelopment programme is recognised as one of the most effective in the nation,
utilising brownfield tax credits to rehabilitate problem properties into productive developments.

Thanks in part to tax credits worth more than half a million dollars, UK-based Pilkington North America recently expanded its value-added automotive glass manufacturing operations by moving production to Lenawee County from Indiana. The company is one of more than 200 in recent years that have chosen to locate to or expand in Michigan, rather than competing sites elsewhere, as a result of the
state’s targeted tax credit incentives.

For exporting companies, the MEDC International Business Development Unit’s efforts are targeted at companies of 500 employees or less. This tends to be the size of company that does not have the resources to support an international department or staff. Large or small, the company that locates in Michigan is well positioned for growth in domestic and world markets.

For more information, visit: www.michigan.org

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