GM is poised to invest billions into its Michigan-based production facilities, announcing $6.5 billion earmarked to support new electric vehicle production, creating an estimated 4,000 new jobs. Michigan lawmakers hope to incentivize the investment with $600 million in tax payer funds, but according to a recent report, the incentives are tied to benchmarks that are lower than the $6.5 billion and 4,000 new jobs that GM originally announced.
Per a recent report from The Detroit News, the proposed GM tax breaks drew criticism from lawmakers, who questioned the proposed incentives and whether or not they were tied to the proper benchmarks, which are lower than the figures which GM initially announced.
Responding to questions from House Appropriations Chairman Thomas Albert, Michigan Economic Development Corp. CEO Quentin Messer Jr. indicated that Michigan will “require repayment” of the incentives if the new GM investment does not result in the creation of at least 3,200 jobs, or 80 percent of the job creation total that GM initially announced. Additionally, Messer indicated that the incentives would require an investment of at least $3 billion, less than half of the $6.5 billion announced previously.
“So just to clarify, these jobs have to be there for six months, so the floor is six months on the jobs and the floor is $3 billion in investment, is that correct?” asked Republican representative Annette Glenn during a House Appropriations Committee this week.
“Yes. That is correct,” Messer replied, per The Detroit News.
Speaker Pro Tem Pamela Hornberger expressed concern over the incentives, especially while small businesses struggled to stay afloat.
“Coming from a family who’s owned a small business for nearly 50 years, it’s really hard for me to swallow this,” Hornberger said during the meeting. “There better be some better things in these contracts other than they can disappear in six months and GM can walk away from it.”
GM’s multi-billion investment is billed as the largest single investment in the automaker’s history. The investment plan includes $4 billion to convert the GM Orion Township Assembly plant for production of new GM all-electric trucks, as well as $2.6 billion to build a third Ultium Cells battery plant in collaboration GM joint venture partner LG Energy Solution.
Subscribe to GM Authority for more General Motors business news and around-the-clock GM news coverage.
Comments
It should draw criticism. Giving huge tax breaks to giant wealthy companies lol sounds like the American way.
When are people going to realize that corporations don’t pay taxes? Taxes are a cost of doing business and ALL COSTS ARE PASSED ONTO THE CONSUMER????
Or the taxpayers, in this case.
Don’t forget Flint in the plant job expansion. Good Hard working folks in Flint that need work in the hometown of GM
Ross P. Alander
Proud Flint Native
Flint-Lansing-Tampa
Flint is famous for the sit-in strike which helped to bring about the CIO, with industrial unions by factory and industry instead of craft unions as in the AFL.
From Wukipedia:
»
The 1936–1937 Flint sit-down strike, also known as the General Motors sit-down strike, the great GM sit-down strike, and so on, was a sitdown strike at the General Motors plant in Flint, Michigan, United States. It changed the United Automobile Workers (UAW) from a collection of isolated local unions on the fringes of the industry into a major labor union, and led to the unionization of the domestic automobile industry.
«
General Motors should have to pay back any tax incentive it receives from the state of Michigan or federally funded free money. How many times do we bail a company out before we let them rest. General Motors is posting huge earnings they need to pay tax like every other American. Also they disgust me and they way they treat us like mice being threaded through a maze to get a new vehicle. They disgust me.
Me again:), don’t forget Flint. My dad was in the sit down strikes in “the hole”, Plant 4. That strike resulted in recognition of the UAW which resulting in fair and better pay, heath care, better working conditions, more job security, etc. The UAW is evolving and now they share in the profits rather than the old COL method and will continue to evolve.
Flint at one time had 10-12 GM operations from AC Spark Plug, Buick, Ternstedt, Fisher Body and on and on. Great town to grow up in. They will never be the same but could do better with small and medium size manufacturing, etc. Now they produce heavy duty Chevy and GMC pick ups
Flint at one time had one of the highest per capita income in the nation. Lots of good hardworking people there and they need and will work for an economic boost in Flint. Thanks for letting me “ramble”,but I love Flint
Peace,
Ross P. Alander, MLIR
Labor Arbitrator-Negotiator-Mediator-Lecturer Negotiation Studies
Labor-ManagementRelaltions.com
Flint-Lansing-Tampa
Me again, as the song goes I was born in Saginaw Michigan true story. In 1957 I had many friends and family members working for General Motors through the years. I chose a different direction but my family always supported General Motors by purchasing their vehicles. I have supported General Motors All My Life by purchasing vehicles for my company. I am appalled at the way they are producing, taking orders, over promising and under delivering! And now they are trying to get out of paying taxes on there enormous profits! Come on I have two General Motors vehicles on order since before Christmas they have not picked up the orders yet. And there are no guarantees that they will build them this season. Regards