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OUR VIEW — Holland is now at the center of a promising industry
3/13/2010
HOLLAND SENTINEL
Holland, MI — LG Chem’s announcement Friday that it will construct a $303 million lithium ion battery cell plant in Holland wasn’t “news” in the sense of being something unexpected. It’s been public knowledge for months that Holland was LG’s first choice, but the Korea-based corporate giant waited until every “i” had been dotted and every “t” crossed before formally confirming its decision.
What is news is that LG’s decision, coming on the heels of the plans by a Johnson Controls-Saft joint venture to build a similar factory of its own in Holland, vaults our community into a central position in a new era of automotive production.
For Holland, the impact of LG’s arrival goes far beyond the more than 400 initial workers the company plans to hire when construction of its factory is completed. Those jobs are certainly valuable, since most of them will be well-paying technical positions. But if that was all we were talking about, the $151 million grant that LG received from the federal government. the $125 million in tax incentives extended by the state and the local tax abatements would be a waste of money. The incentives helped ensure that a critical valued-added component of the automotive industry is located right here in Michigan rather than migrating overseas. The potential scope of the advanced battery business is huge, with estimates of eventual annual sales ranging from $20 billion to $60 billion, and we are now at the epicenter of that industry in North America. LG and Johnson Controls-Saft will be the focus of a new network of suppliers, many of whom will likely be located in Holland and the greater West Michigan area, multiplying the economic impact of the new factories.
Just as newsworthy is the statement that LG and Johnson Controls have made about Holland. There’s not a community in Michigan, and few anywhere in the country, that wouldn’t have bent over backwards to land these factories. These two savvy multinational conglomerates could have gone almost anywhere — other communities easily could have matched or beaten Holland’s financial incentive package. LG conducted an extraordinarily detailed site review before choosing Holland. Company officials liked the city’s location and infrastructure, but more importantly they were impressed with the quality of our workforce and our history of positive employer-employee relations. Successful companies like Herman Miller, Haworth and Gentex have given the Holland-Zeeland area a highly positive national reputation in business circles. The decisions made by LG and Johnson Controls now give us an international identity to build on.
The community owes thanks to Lakeshore Advantage, the area’s economic development agency, and the many government and private industry leaders who worked to make a united appeal to LG. We believe their successful campaign bodes well for future efforts to attract major employers here, particularly foreign-based multinationals.
Of course, there are no guarantees of future prosperity for Holland. We’ve seen examples before when promising business expansions didn’t live up to expectations because the economy failed to cooperate. Those are risks we can’t avoid. Neither will the economic boost come quickly — LG isn’t scheduled to start battery production until 2012. Today though, we celebrate a great opportunity, an opportunity for Holland to welcome an important new corporate citizen and take a giant step forward with a promising new industry. Our short-term economic forecast is still cloudy, but our longer-term future is looking increasingly bright.
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