General Motors Corp., Johnson Controls Inc. and Chivas Products Ltd. are combining for a large boost to Detroit's new federal Empowerment Zone. GM announces it will award JCI and Chivas a six-year contract worth an estimated $900 million to produce interior components and systems for model-year 2000 vehicles and beyond.
Detroit Mayor Dennis Archer and Harold Kutner, GM's purchasing vice president, were on hand for the late-January announcement.
The contract calls for JCI and Chivas, a minority-owned supplier, to form a joint venture in which the former will be responsible for product design, engineering and development. Chivas will have majority ownership in the company and be responsible for manufacturing the various interior products.
Preliminary plans call for construction of a $5 million, 70,000-sq.-ft. (6,500-sq.-m) facility in the Bing Industrial Park area of the Empowerment Zone in early 1998. Production is expected to begin by mid-1999.
Detroit's Empowerment Zone is an area targeted by federal and municipal governments for urban revitalization. The city receives federal grants to improve the quality of life for residents and tax breaks and other incentives to entice businesses to relocate or expand within the 18-square-mile (47-sq.-km) area in southwestern, central and eastern sections of Detroit.
GM says this new business is a major advancement in its overall minority supplier development program. It also reflects JCI's strong commitment to minority suppliers, says JCI.
To date, GM has made commitments of more than $1 billion to minority suppliers who have facilities in the Empowerment Zone or who have made commitments to build in the Empowerment Zone,