Mahindra sets sights on Buick City brownfield
It’s been 20 years since the last Buick rolled off the assembly line at Flint, Michigan’s Buick City complex. Buick started building cars and trucks in Flint more than a century ago, eventually employing as many as 27,000 workers there. Now, Mahindra Automotive North America has signed a non-binding letter of intent to purchase the 364-acre site from RACER, the trust managing the properties disposed of in General Motors’ 2009 bankruptcy. A new automotive assembly plant there would likely employ as many as 2000 people. Mahindra is currently negotiating with state and local officials for some sort of incentive package.
Mahindra is one of the bidders on the $6.3 billion contract to build 180,000 of the U.S. Postal Service’s next-generation mail trucks. Should it win that contract, Mahidra would have to construct an entirely new factory, as the Buick City site is mostly an empty brownfield, with the massive Buick and Chevrolet factories long since torn down. Should its bid not be accepted, Mahindra has other options for the site.
“Having a large revenue stream that’s guaranteed for six to 20 years is a great enabler to fast-track the rest of your business in the United States,” Mahindra North America CEO Rick Haas told the Detroit News. “If I didn’t have that mule to ride, with that contract attached to it, now I gotta figure out how to do it without the mule.”
The Detroit News reports that Mahindra has bigger plans for the postal van platform, with derivatives planned to compete in the general commercial vehicle market.
Should the plans for the Buick City factory pan out, Mahindra could also switch production of the Roxor 4×4 off-road vehicle from its Auburn Hills, Michigan assembly facility to the new plant. It could also try to sell the rugged, body-on-frame Marazzo MPV, which was developed at Mahindra’s Auburn Hills R&D facility for Mahindra’s domestic market in India. There have been rumors that Mahindra might try to make the Roxor street-legal, but Mahindra is already facing a legal challenge from FCA regarding the derivative of the military Jeep the Indian company was licensed to assemble 70 years ago.
Before any new construction on the Flint site can begin, environmental testing and cleanup on must be completed, due to more than a century of industrial contamination; but Mahindra says that it is up to the challenge.
“We like the fact that it’s a historic site,” Haas said. “We like that it’s in an area that needs a lot of TLC. The city’s… pretty grim in parts of it, and we’d like to help. And it’s a great story to tell.”
“It does have a really good chance of becoming real,” Haas said, acknowledging that the Flint site isn’t Mahindra’s only option. The company had previously looked at Detroit but couldn’t find a large enough parcel adjacent to a railroad siding.
While Mahindra already assembles the Roxor in Michigan, the proposed factory in Flint would take up about a million square feet of space and be the company’s first major manufacturing facility in North America.
As the transportation scene changes, with mobility and shared-use becoming popular buzzwords, focusing on commercial vans and people movers may involve less risk than making personal automobiles.
“With the industry in chaos like it is now, with people shifting from personal ownership to shared mobility… the whole industry is going to start to look real odd for the next couple of decades as people push and pull to try and figure out where they fit in,” CEO Haas said.