India-based automaker Mahindra plans to revitalize Flint's Buick City in a deal that could lead to 2,000 jobs.
Mahindra North America Inc. signed a letter of intent with RACER Trust to build a plant what is expected to be a $1 billion investment on the remaining 364 acres of the site, which was once the home to the majority of Buick's operations before operations ceased in 2010 following the General Motors bankruptcy.
Rick Hass, president and CEO of Mahindra North America, said the plan calls for the construction of a 1 million-square-foot facility with expectations to build another 1 million square feet in the future. He declined to discuss the investment total, but plants in similar size result in a $1 billion-plus investment, according to Crain's research.
"The investment size depends on how you manage it, whether it's a lease versus buy," Haas said. "We're weighing options. We're taking with the state of Michigan, but Mahindra is a $20 billion multinational company. They have the ability to self-finance if we choose to go that way. There are all kinds of ways to make this happen."
Mahindra is out of capacity at its Auburn Hills plant, where it manufactures an off-road vehicle called the Roxor, and requires more production space, the company said in a news release. It's also looking to bring more of its international offerings to the U.S., Haas said. He declined to reveal the company's product planning, but said there is interest in producing a commercial van and Mahindra's Marazzo, a front-wheel drive, body-on-frame compact crossover at the plant.
Mahindra also manufactures the GenZe brand of electric bikes and scooters, which could also be produced at the Flint locations, Haas said.
"Our story wants to be a mobility story," said Richard Ansell, Mahindra North America's vice president of marketing. "Probably sell large commercial vans to last-mile mobility options."
Mahindra would also move Roxor production to Flint and its Auburn Hills plant would serve as a product incubator, Haas confirmed.
However, Mahindra's expansion is highly contingent on its ability to secure a $6 billion contract to build next-generation delivery vehicles for the U.S. Postal Service. Mahindra is one of six finalists for the contract, which includes a 20-year parts supply deal, to build 180,000 delivery vehicles. USPS is expected to make its decision later this year.
Another finalist for the contract is Cincinnati-based Workhorse Group Inc., which plans to revitalize GM's idled assembly plant in Lordstown, Ohio, if it wins the contract.