The state of Michigan is backing auto seat maker Adient Ltd. in its bid to move its corporate headquarters to downtown Detroit, awarding the company a $2 million grant in exchange for 115 new jobs.
Adient plans to spend $97.9 million to move its headquarters into the city after being spun off from Glendale, Wis.-based Johnson Controls Inc. in October, according to the Michigan Economic Development Corp. The MEDC's Michigan Strategic Fund board on Nov. 22 approved the performance-based grant for Adient.
The state did not disclose the location of Adient's new headquarters, but sources recently told Crain's Detroit Business that Adient will move into the Marquette Building, which is adjacent to Cobo Center, the home of the North American International Auto Show and other major events. CDB is a sister publication of Plastics News.
"We are pleased that the Michigan Economic Development Council today approved incentives for Adient to add jobs in downtown Detroit," Adient said in a statement. "We will take these incentives into consideration as we make a final decision for the location of our new headquarters, and expect to make an official announcement in the next several days."
The 115 new jobs would be in addition to 1,240 employees statewide, the MEDC said.
The MEDC said its grant was needed to offset higher costs of renovating the building in Detroit, compared with "minimal investment" required in Wisconsin.
"This, in addition to finding parking for the 500 total employees they plan on having at the headquarters and paying the Detroit payroll tax for its employees, puts Michigan at a large disadvantage," the MEDC wrote in a memo to the Strategic Fund board.
The city of Detroit offered a property tax incentive, according to the MEDC.
With the spinoff complete, Adient is the first Fortune 500 company to relocate its headquarters to southeast Michigan since auto supplier BorgWarner Inc. moved to Auburn Hills in 2004.
Adient is tax domiciled in Dublin, Ireland, and is estimated to be worth $17 billion.