Governor Jennifer M. Granholm today announced BAE Systems is launching a $58.4 million expansion project for its Land & Armaments operating group in Sterling Heights. The project is expected to create 460 new engineering and high-tech jobs at the company and an additional 559 spin-off jobs over the next 14 years. Assistance provided by Michigan Economic Development Corporation helped convince the company to choose Michigan for the expansion over competing sites in Alabama, Pennsylvania and California.
This expansion shows we have the talent and the tools needed for companies like BAE Systems to research, develop and manufacture the next generation of homeland security and defense applications and grow new high-paying, high-tech jobs in Michigan,” Granholm said. “We look forward to continuing our strong partnership with BAE Systems to ensure the company’s ongoing success in Michigan.”
Based on the MEDC’s recommendation, the Michigan Economic Growth Authority board today approved a state tax credit valued at $22.1 million over 14 years to secure the company’s investment. In addition, the MEDC has approved a $460,000 Economic Development Job Training grant to train new hires. The city of Sterling Heights has proposed a 12-year abatement worth $4.6 million to support the project.
BAE Systems plans to convert an existing large industrial property in Sterling Heights into a state-of-the-art prototyping and test facility.
“Initiatives like the MEDC’s Defense Contract Coordinating Center and other efforts underscore the steps we’re taking to diversify our economy and grow the homeland security and defense industry in Michigan,” MEDC President and CEO James C. Epolito said. “We appreciate the support and cooperation of Sterling Heights in helping to make a strong business case to win this project and the new jobs that will be created as a result.”
An economic analysis conducted by the MEDC estimates that increased economic activity created by the expansion will generate an additional 559 indirect Michigan jobs, in addition to the 460 created directly by the company. The project is expected to generate more than $923 million in personal income for Michigan workers over the life of the tax credit.
“This is a terrific partnership for all parties involved,” said Linda Hudson, president of BAE Systems Land and Armaments. “The support we've received from the state and city of Sterling Heights provides us with the capabilities to build a larger presence in Michigan and ultimately build better combat and tactical systems to better serve our customers.”
BAE Systems is the premier global defense and aerospace company delivering a full range of products and services for air, land and naval forces, as well as advanced electronics, information technology solutions and customer support services. BAE Systems has 97,500 employees worldwide.
The Land & Armaments operating group is a global leader in the design, development, production and service support of armored combat vehicles, major and minor caliber naval guns and missile launchers, canister, artillery systems and intelligent munitions. Headquartered in Arlington, Virginia, the group employs nearly 11,000 personnel world wide with operations in 30 locations in the UK, South Africa, Sweden and United States, and markets in more than two dozen countries.
“Sterling Heights has been on the forefront in the area of economic development and we are doing all that is possible to retain our existing businesses and attract new prospects,” Mayor Richard Notte said. “We are pleased that BAE chose to expand in Sterling Heights and we look forward to BAE becoming a major player in our corporate community.”
The BAE Systems expansion is one of five economic development projects the governor announced today. In all, they are expected to create and retain a total of 9,013 Michigan jobs.
In her 2008 State of the State address, Granholm emphasized the importance of creating opportunity in the changing world of the 21st century. Since January 2005, the governor and the MEDC have announced the creation or retention of more than 235,000 jobs as a result of targeted assistance provided by the MEDC.
The Michigan Economic Development Corp., a partnership between the state and local communities, promotes smart economic growth by developing strategies and providing services to create and retain good jobs and a high quality of life. For more information on MEDC initiatives and programs, visit the Web site at www.MichiganBusiness.org.
BAE Systems LP
(All estimates in 2008 dollars)
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