Auto interiors supplier Dakkota Integrated Systems LLC will build a new plant on Detroit's east side employing 625 people making parts for Fiat Chrysler Automobiles' new Jeep assembly plant, now being built.
Dakkota plans to build a $55 million, 600,000-square-foot facility on 32 acres at the shuttered Kettering High School.
Dakkota company leaders, Detroit Mayor Mike Duggan and other partners announced the project July 9 in front of the school building.
Kettering and a nearby elementary school will be razed to make way for the new manufacturing plant, though Dakkota has pledged to preserve the big blue letter "K" in front of the Kettering building near I-94.
The company has not released any details of what it will produce at the site, but the company already is an integrator for Ford Motor Co. at another Detroit site, assembling interior parts. It is not clear if it will do any on-site molding.
The news comes as Detroit angles for suppliers to expand in Detroit alongside Auburn Hills, Mich.-based FCA US LLC's $2.5 billion investment and 5,000 new automotive jobs planned at two Detroit plants. Duggan has previously hinted that the city was in talks with logistics and supplier teams to create more jobs on top of Fiat Chrysler's.
Like the FCA plant, where construction has been underway for well over a month, Dakkota will be under a tight deadline to build a new plant in time to begin supplying parts to FCA by the fourth quarter of 2020, when FCA wants new Jeeps to be rolling off the assembly line.
Construction is expected to begin within 60 days of the deal closing.
For the project to go forward, Dakkota will seek city planning commission approval to rezone the land from residential to manufacturing.
The Duggan administration also will be asking the Michigan Strategic Fund and City Council for a 10-year Detroit Next Michigan Development Corporation Renaissance Zone abatement on 100 percent of all real property tax, corporate income taxes and utility user taxes.
Detroit gave similar tax breaks to Urbana, Ill.-based auto supplier Flex-N-Gate to build its new $160 million plant in the I-94 Industrial Park, which supplies metal and injection molded parts to Ford Motor Co.'s Michigan Assembly Plant in Wayne.
Dakkota Integrated Systems was launched in 2001 as a joint venture between majority partner Rush Group LLC, owned by trucking and auto supply entrepreneur Andra Rush, and auto supplier Magna International Inc. Its corporate office is in Holt, Mich.
"Our mission is to profitably create jobs and develop top talent, all while exceeding our customers' expectations," Andra Rush said in a statement. "We're so proud to support FCA, provide employment opportunities in Detroit, and showcase world-class quality auto parts built by hardworking Detroiters."
The company manages assembly and sequencing of integrated automotive interiors for original equipment manufacturers.
Duggan said Dakkota has pledged to give Detroiters first priority for the new jobs the same way FCA has pledged to for its expansion at Mack Avenue and modernization of its Jefferson North Assembly Plant.
Duggan has hinted in recent weeks that an FCA supplier deal was in the works.
At a June 26 event, Duggan said he met that week with an automotive supplier that was planning to build a plant to make dashboard parts for Jeep Grand Cherokees.
Construction to convert FCA's two Mack Avenue engine plants into a finished vehicle assembly plant has been under way for at least a month.
As part of a wider Southeast Michigan deal, FCA will invest $1.6 billion to convert the idled Mack Avenue Engine Complex to build the next-generation Jeep Grand Cherokee and a new three-row full-size Jeep SUV, starting in late 2020, creating 3,850 new jobs; and will invest $900 million at Jefferson North Assembly Plant in Detroit to update the plant for Dodge Durango and the Wagoneer, creating an expected 1,100 new jobs.