Huei Peng is familiar with the numbers that have electrified the greater Detroit area over the past months. All the billions of dollars that carmakers plan to invest in the coming years: in technology centers, in testing grounds for autonomous driving and in whole wings of gigantic shopping centers, soon to host co-working spaces for creative minds conceiving the mobility of tomorrow. “When it’s about the future of automobility,” says Peng, “hardly anyone will be able to bypass Michigan with its hub, Detroit.”
Peng presides over the Mobility Transformation Center at the University of Michigan, where he’s intensively busy with present and future developments in mobility in the United States. The massive investments being made here do not surprise him. He says there’s no real alternative to Detroit in the US. “The know-how of the automotive industry is collected here.”
Michigan is the undisputed leader in the American market for the production of motor vehicles. Officials report that sixteen original equipment manufacturers have headquarters or technology centers in the state. Along with the Big Three—General Motors, Ford, and Fiat-Chrysler—also Toyota, Volkswagen, Nissan and Hyundai have subsidiaries here. Ninety-two of the global top one hundred suppliers are also located in the state. What’s more, increasing numbers of companies from the technology, infrastructure and insurance sectors are setting up shop here, particularly to advance the field of networked driving.
Some observers are asking themselves now: Is Lake Erie on the cusp of a new success story like the one that started more than a century ago, when Henry Ford produced the first assembly-line car, sparking an era of increasing prosperity? With a better ending this time, if possible?
Following its dramatic ascent, which began with Ford’s innovation in 1913, the heart of the American automotive industry started beating somewhat irregularly from the 1960s on. The dominant sector of the auto industry became increasingly automated, and production moved to countries where costs were lower. Scores of jobs were lost, many factories fell into disrepair. The former strength became a problem: Detroit was too dependent on the single, major industrial sector of car manufacturing. The city began rapidly hemorrhaging jobs, residents and tax-paying businesses, with the recession reaching its nadir at the start of the twenty-first century. When the global financial crisis came in 2007/2008, it hit Detroit harder than almost any other city in the world.