©2018 Michigan Economic Development Corporation

German-Based Firm Expanding Auburn Hills HQ, Adding 240 New Jobs

Tuesday, November 16, 2004

Michael Shore, MEDC
(517) 335-4590

Governor's Announcement of $15 Million Project During German Investment Mission Applauded by L. Brooks Patterson

In the midst of an investment mission in Germany, Governor Jennifer M. Granholm announced today that German-based pgam* corporation will expand its operations in Auburn Hills, creating approximately 240 new jobs for Michigan workers. The Governor announced the expansion following a meeting with Oakland County Executive L. Brooks Patterson and pgam officials at the company's headquarters in Georgsmarienhuette.

Granholm and Patterson are on the second day of an investment mission to the country to convince German companies to invest and create jobs in Michigan.

"pgam is an outstanding advanced automotive and homeland security company that is developing and manufacturing new technologies for high-tech vehicles of the 21st century," said Granholm. "With more than 85 percent of all North American automotive R&D and a large share of new vehicle manufacturing, Michigan is one of the strongest automotive clusters in the world. I am pleased to welcome pgam's newest commitment to Michigan to further cement our leadership in this ever-growing global market."

Patterson said pgam's decision is welcomed news for Oakland County.

"pgam is a company that Oakland County and the State have worked with since they established U.S. operations," said Patterson. "We are excited that pgam is developing advanced applications to meet the future demands of a complex market."

The expansion is a result of assistance offered through the Michigan Economic Development Corporation (MEDC). The MEDC approved a Single Business Tax (SBT) credit valued at more than $1.7 million to help convince pgam to choose Michigan over a competing site in Ohio. The expansion is expected to generate more than $15.3 million in private investment. pgam will soon present a final investment plan to its supervisory board.

*pgam is an acronym, and not to be pronounced as a word

"pgam AG originally came to Michigan to work more closely with automotive manufacturers. In doing so, it found a state and local government anxious to support its activities," said pgam corporation chair Josef Marold. "This close working relationship will be supportive of growth opportunities for pgam and Michigan's economy."

The city of Auburn Hills is expected to support the expansion with an abatement of the company's real and personal property taxes valued at some $700,000 over eight years.

A University of Michigan economic analysis estimates that 123 indirect Michigan jobs will be created as a result of increased economic activity associated with the expansion, in addition to the 117 jobs created directly by the company. The project is expected to generate more than $111 million in personal income for Michigan workers over the life of the tax credit.

According to Dunn & Bradstreet data, there are 610 companies in Michigan with German ownership.

"Michigan remains a highly competitive location for automotive investment on the global stage," said MEDC President and CEO Don Jakeway. "pgam is responding to global challenges by being innovative, and the company's success here in Michigan is a positive indication that they are doing that very well."

Headquartered in Auburn Hills, pgam is the North American subsidiary of pgam advanced technologies AG of Germany, a global Tier Two auto supplier with six locations worldwide. The Auburn Hills facility uses the latest technology to produce tools and parts for Ford, General Motors, Bentley and Audi specialty vehicles.

In her 2004 State of the State address, Governor Granholm announced her plan to make Michigan a global economic powerhouse in the 21st century. So far this year, the Governor and the MEDC have announced the creation or retention of approximately 32,034 jobs as a result of targeted assistance provided by the MEDC.

The Michigan Economic Development Corporation, 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.

pgam corporation
Economic Analysis
Summary Estimates
(All estimates in 2004 dollars)

Revenue Foregone$1,700,000
Revenue Gain$8,549,000
Average Wage$771/week
Personal Income Generated Over
Life of the Tax Credit Agreement