DETROIT — The Lansing region is in line to benefit from an auto industry hiring boost.
Automakers and their suppliers are poised to bring on new workers across the U.S. as the companies prepare for rising customer demand for new vehicles.
Locally, General Motors Co. plans to add 200 jobs next year when it completes a new, $44.5 million logistics center at its Lansing Grand River assembly plant. The facility will be used to sort and deliver parts to the assembly line in a process known as sequencing.
That follows the addition of 600 new hourly workers and a second shift last year at Lansing Grand River when the Detroit automaker launched the new Cadillac ATS luxury small car. GM plans to build the next generation of the Chevrolet Camaro at the plant, possibly in 2015, and United Auto Workers leaders hope that means a third shift will be added.
GM already operates three shifts at its Lansing Delta Township assembly plant to produce the Buick Enclave, Chevrolet Traverse and GMC Acadia crossovers.
And Norplas Industries, an Ohio-based subsidiary of Canadian auto supplier Magna International Inc., will create 400 jobs when it builds a 350,000-square-foot factory in Delta Township.
The latter’s urgency “really does portray how urgent the situation is with capacity issues in the auto industry,” said Bob Trezise, president and CEO of regional economic development firm Lansing Economic Area Partnership Inc. “A pinnacle of GM manufacturing is certainly here. It’s got to mean something good for us, and even further supplier work.”
The new employees will be part of a larger, busier workforce. Factories are operating at about 95 percent of capacity, and many are already running three shifts. As a result, some auto and parts companies are doing something they’ve been reluctant to consider since the recession: Adding floor space and spending millions of dollars on new equipment.
The auto industry’s stepped-up hiring will help sustain the nation’s job growth and help fuel consumer spending.
Recently, the government said U.S. employers added 175,000 jobs in May, roughly the monthly average for the past year and a sign of the economy’s resilience.
Car companies and parts makers created 167,500 jobs from the end of the recession in June 2009 through May. At the same time, U.S. auto sales rose from a low point of 10.4 million in 2009 to an annual rate of more than 15 million so far this year.
Hiring will start this fall for Magna’s Delta Township operation, spokesman Scott Worden said. Norplas Industries expects to start limited production at the robotic paint line and injection molding plant it’s building on Mount Hope Highway early in 2014. Full production should follow later next year. Details on the types of positions to be filled weren’t available, although Worden said they likely will be predominantly on the production line.
The company has applied for a tax incentive from Delta Township, citing in documents plans to spend $82.7 million on the project.
The township board could consider the request next month. The value of the tax incentive was not available.
At 7.6 percent, U.S. unemployment remains well above the 5 percent to 6 percent typical of a healthy economy. Growth is still modest, in part because of higher taxes and government spending cuts that kicked in this year and weak overseas economies. But the housing market is strengthening, and U.S. consumer confidence has reached a five-year high.
The auto industry’s outlook is bright. Vehicle sales for 2013 could reach 15.5 million, the highest in six years. To meet that demand, automakers must find more people. Hundreds of companies that make parts for automakers have to hire, too, just to keep up.
From January through May, automakers and parts companies hired 8,000 workers, a relatively slow rate. But the pace is picking up.
The Center for Automotive Research in Ann Arbor expects the industry to add 35,000 over the full year.
The hiring plans are widespread. GM, Chrysler Group LLC, Honda Motor Co., Mercedes-Benz and Ford Motor Co. plan to add more than 13,000 people this year.
Large parts companies such as Lear, BorgWarner Inc. and TRW Automotive Holdings Corp. are hiring at factories and research centers. Smaller suppliers are adding workers as well.
The auto business has helped keep the economy afloat while Americans wait for the rest of the business world to start hiring. Since 2009, one in every four manufacturing jobs added in the U.S. came in the auto industry, said Daniel Meckstroth, chief economist for the Manufacturers Alliance for Productivity and Innovation, a manufacturing trade group.
Among other hiring planned for this year:
• Chrysler will add more than 3,500 workers this year at factories in Indiana, Ohio and Michigan to make transmissions and to build Jeeps and Ram pickups.
• Ford expects to hire 2,200 salaried workers in information technology, product development and manufacturing. Plus, the company is hiring 1,400 factory workers and recalling another 2,000 laid-off employees in Michigan and Missouri.
• GM is hiring 4,000 engineers and computer professionals at four technical centers in Arizona, Georgia, Michigan and Texas to develop software and other innovations.
• At TRW Automotive, recruiters are looking for 50 engineers in the Detroit area to work on new safety features such as a system that warns drivers when large animals are in their path.
Even with the added hiring, the auto industry isn’t the job creator it once was. In 2005, before huge cuts began, more than 1.1 million people made motor vehicles and parts. Now, 798,000 do, according to the latest government statistics.
For engineers and many white-collar jobs, auto companies pay salaries that are competitive with the rest of the country. But wages and benefits in the factories have declined.
Most new hires will start around $16 per hour, a little over half the pay that longtime workers get. The lower wage was a concession made by the United Auto Workers union to cut costs as the companies ran into financial trouble six years ago. New hires receive health care but get 401(k) plans instead of pensions, and they don’t get health care in retirement like longtime workers do.
Still, their wages are better than most other factory workers, who make $13 to $14 per hour in the U.S.
GM officials won’t know how employees will be hired to fill jobs at the logistics center until the building is finished, Lansing spokeswoman Erin Davis said. The automaker is contractually obligated with the UAW to recall GM employees out of work before it hires from the outside. The company plans to close its Grand Blanc Weld Tool Center this summer. It’s not yet known whether that closing will affect hiring at the logistics center, which is expected to finish construction in September 2014.
About 90 new hourly production workers recently started at GM’s Lansing Delta Township assembly plant, where the Buick Enclave, Chevrolet Traverse and GMC Acadia crossovers are built, Davis said. They were hired to replace employees who transferred from Spring Hill, Tenn., when GM moved production of the Traverse to Michigan. Many of the Tennessee workers since have moved to plants closer to home.
Lansing State Journal reporter Lindsay VanHulle and Tom Krisher of The Associated Press contributed to this report, Lansing State Journal.
