Visteon Corp. has reached an agreement with the state to build a new manufacturing facility and is expected to create 175 jobs.
The company also announced Tuesday that its chief financial officer, Jim Palmer, has left to take a job as CFO for aerospace giant Northrop Grumman. He will be replaced by Bill Quigley, Visteon's corporate controller and chief accounting officer.
The new factory will manufacture interior components for a single automotive customer, supplying parts to final assembly plants in Michigan and other states. Gov. Jennifer Granholm called it "a great example of the type of advanced manufacturing growth we are targeting." The company would not say when the plant is expected to open.
"The company's investment in Highland Park will bring good-paying jobs to the community and strengthen Michigan's position as the global leader in automotive research and development," she said in a statement Tuesday.
Visteon will invest $35 million to build the facility, which the state also expects to create more than 175 indirect jobs in Michigan and generate $151 million in personal income for Michigan workers over seven years. In exchange, the company will receive a state tax credit worth $1.73 million and local tax abatements worth $4.5 million over seven years.
"We are pleased with the state and local support of our plan," said Visteon spokesman Jim Fisher, though he wouldn't discuss the particulars of the project. "Until all aspects of the project are final, we cannot confirm our specific plans. We hope to provide details soon."
Fisher did say the new plant will support a new contract with a single unidentified customer.
Jim Gillette, director of supplier analysis for CSM Worldwide, said Visteon's modest investment suggests this will be a small facility with limited flexibility. He expects the company decided to build it in the United States because of complex customer requirements for just-in-time sourcing. Otherwise, labor costs would be too high to warrant Visteon's investment in Michigan.
"That's really the only reason they would do it. The wage rates are sky-high, and there's a lot of excess capacity here," Gillette said. "It would have to be something very specialized."
Visteon struggled to stand alone after being spun-off from Ford in 2000. Five years later, Ford agreed to take back most of Visteon's U.S. factories as part of a massive bailout deal. That agreement allowed Visteon to enjoy a few quarters of profitability, but the supplier has still never posted a full-year profit and swung back into the red late last year as important customers like Ford cut production.
Visteon retained its Van Buren Township headquarters, but has concentrated on its overseas operations.