GE's Michigan R&D Investment Is a Great Idea

Where is General Electric (GE) putting its new US$100MM++ Advanced Manufacturing Technology & Software Center? Wayne County, Michigan!

CEO Jeff Immelt says that GE, among other companies, needs to “recreate” technology centers. Isn’t that the truth. The Michigan state government will provide just $5 million of incentives per annum over the next 12 years; seems like a good investment to me (rather than putting a few hundred million into the Ford Motor (F) V8 Essex engine plant across the river near Windsor).

GE’s announcement is a wonderful idea. And there is something poetic about putting a tech centre in the backyard of the old economy. And an idea for all levels of government in Canada to consider. With the demise of Nortel (NT), Canada is losing its historical tech flagship. Bell Labs is no more, as are the tech transfer spinoffs.

If Canada is to rebuild its Innovation Economy, we need to do more than just fund on-campus R&D and save a few venture capital funds. We need to get the corporate sector far more involved, just as Michigan Governor Jennifer Granholm has done.

Comments

[Dave Wrixon:]

Collapsing industries leave behind untapped pools of talent. Yes, some companies will make use of this situation. But tell me, how is reconstruction going at the World Trade Center? Sure something will rise from the ashes, but it is going to be long hard slog, and will probably be no match for former glory.

Jun 28 05:38 AM

[Old Rick:]

I'd be curious if this were a pure business decision on the part of Immelt, or if he, as a part of the Obama team and depending on government (with a small "G") handouts for GEs alternative energy efforts, was pressured to put this center in a "blue" state.

Jun 28 09:19 AM

[floridagal:]

It sounds like an interesting idea to me - thinking outside of the box.
Michigan needs help and this has more long range possibilities than a dying auto industry.
GE needs new technolgies and developing them will be more profitable long term than buying them.

Jun 28 10:50 AM

[floridagal:]

It seems to me it is thinking outside of the box. Michigan needs lots of help and better to concentrate on business development rather than an old, tired auto industry.
GE needs new technology in order to regain its former position and better to do it with their own research than buying it from others.
That was GE's strength in the past.

Jun 28 11:03 AM

[lorddarley:]

Sounds like politics, rather than common sense.

Jun 28 12:14 PM

[fapples:]

I see there is at least one negative comment posted here. Where are all the pro GE people at? For heaven's sake General Electric is the most diversified US Company ever, plus a multi-billion dollar enterprise....what gives with all the negative press?? People obviously don't like the CEO but gosh darn don't take it out on the company and the investors....Remember: the econony as a whole is not in that good a shape!!!!

Jun 28 01:35 PM

[buoy:]

fapples...cutting dividends might have a lttle to do with it.

Jun 28 03:35 PM

[woodsey:]

This could be the move that helps the US regain her manufacturing base. The center itself provides more good jobs. The advanced technology it produces will mean even more jobs.

Jun 28 03:48 PM

[Tdot:]

Well here's a full circle of ironic history repeating itself.

During the early to mid 1990's, GE laid off more than a third of their top engineers working in the military and commercial Aircraft Engines business, which was headquartered in Cincinnati. The economy was in a recession, coming off the Bush I administration, and the Clintons were ending spending on Defense and Aerospace, diverting all the money they could find and more into social welfare, rebuilding the economy, and other domestic "safety net" spending, trying to establish National Health Care. The massive Aerospace and Defense Industry collapsed and consolidated, and many of those GE Engineers migrated to Detroit to work for the Big Three Automotive Industry, along with the Transplants who were also setting up shop around Detroit.

Now the economy is in a recession, coming off the Bush II administration, the massive Automotive Industry is in collapse, and the Obamas are spending anything and everything they can find and more on rebuilding the economy, providing a "safety net" for the Automotives, and on domestic social welfare spending, trying to establish National Health Care. Meanwhile GE is setting up shop in Detroit - to hire back those same Engineers they fired in 1993. To build windmills - err - wind turbines.

Ah well, time to update the Resume...

Jun 28 07:09 PM

[dondon:]

R&D is great but it will not replace manufacturing. And besides, once a product is designed, GE will have it manufactured in a country with lower manufacturing costs.

Jun 30 04:06 AM

[Doc 224899:]

Jeff Immelt could "recreate" GE technology centers in two very productive locations in Virginia. The Virginia state legislature could offer $10M in tax exemptions/grants to GE to set up a GE R&D mill right next to Virginia Tech. They could also offer tax exemptions/grants to GE to re-open tens of thousands of square feet of unused space in the GE technology center that stands almost completely unused in Salem, in Roanoke County. We would, of course, have to wait and see if the demographics in Wayne County, MI, inspire greater interest from Washington and GE than either of these two areas in Virginia.

Jul 05 04:10 PM

[Doc 224899:]

Tdot,

Haven't you been paying attention, Tdot? Washington has determined that we don't need engineers any more. Look at the pay engineers are stuck with, and compare that to lawyers' pay. All we need is a legislative branch that doesn't read the legislation proposed by the executive branch, and sympathetic talk show hosts engaged in endless struggles to miminize their own butt diameters, and we'll do fine with no engineers at all.

On Jun 28 07:09 PM Tdot wrote:

> Well here's a full circle of ironic history repeating itself. <br/>
>
> During the early to mid 1990's, GE laid off more than a third of
> their top engineers working in the military and commercial Aircraft
> Engines business, which was headquartered in Cincinnati. The economy
> was in a recession, coming off the Bush I administration, and the
> Clintons were ending spending on Defense and Aerospace, diverting
> all the money they could find and more into social welfare, rebuilding
> the economy, and other domestic "safety net" spending, trying to
> establish National Health Care. The massive Aerospace and Defense
> Industry collapsed and consolidated, and many of those GE Engineers
> migrated to Detroit to work for the Big Three Automotive Industry,
> along with the Transplants who were also setting up shop around Detroit.
>
>
> Now the economy is in a recession, coming off the Bush II administration,
> the massive Automotive Industry is in collapse, and the Obamas are
> spending anything and everything they can find and more on rebuilding
> the economy, providing a "safety net" for the Automotives, and on
> domestic social welfare spending, trying to establish National Health
> Care. Meanwhile GE is setting up shop in Detroit - to hire back those
> same Engineers they fired in 1993. To build windmills - err - wind
> turbines.
>
> Ah well, time to update the Resume...

Jul 05 04:27 PM