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Manufacturing jobs increase in Detroit I
PAGE 6
It~WDIV-TVexpects truck r .' to haul in profits PAGE 13
New GM policies pinch ad agencies
PAGE 19 WEEK OF JULY 29 - AUG. 4, 1985 VOLUME 1
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NO. 26
Report sees auto supply woes by'87
Two cities seek park to attract suppliers BY JEAN HALLIDAY
BY JANE WHITE
Special to CRAiN'S DETROIT BUSINESS
CRAiN'S DETROIT BUSINESS
The cities of Lincoln Park and Ecorse, in a move to woo auto suppliers that will serve the Mazda Motors of America plant being built in nearby Flat Rock, started joint venture talks this month to buy land from Great Lakes Steel Corp. for an industrial park. But this tale of two cities may be one of disappointment, because another buyer could pull the rug from under them. Art Warmuskerken, a spokesman for Great Lakes Steel, said, "We are considering the sale of that property to those communities or to someone else." He added that several other developers have also recently expressed interest in the 54-acre site - the former Michigan Steel Works in southern Ecorse on Mill Street. The southeast border of the property is Ecorse Creek, which is the boundary of Ecorse, Lincoln Park and Wyandotte. While Warmuskerken said it's unlikely that Great Lakes Steel will seek bids for the sale, he did indicate that the company is looking at the bottom line selling price of the property, which is assessed at $1 million. "We want to get the most out of the property that we can," he said. Estimates for buying the site, possible demolition of all or several buildings on the property and site preparation are in the range of $10 million, said Tom Enright, city controller in Ecorse. Enright said the cities may be a little short of cash and will need some help from the state and federal governments. "We have about $5 million to $7 million from our own sources, so that leaves us about $4 million shy," he explained. Ecorse Mayor Kenneth Slifka said the two cities would go to the
The twin threats of increased Japanese imports and domestically assembled Japanese cars could mean that many auto suppliers "will not be able to survive beyond 1987 or 1988," according to a report issued by the Industrial Technology Institute of Ann Arbor. The March 31 lifting of the voluntary restraint agreement on imported cars will mean that Japanese car sales will increase by 36 percent to 57 percent by 1987, say economists Daniel Luria and Michael Flynn in their study titled "The Post-VRA U.S. Automotive Market." The month-long, $25,000 study grew out of another one commissioned by a local supplier who wanted to see the VRA's impact, Luria says. The impact on local suppliers, coupled with changes in the economy, could mean a sales drop of anywhere from 6 percent to 34 percent, comparing last year's figures with projections for 1987. As Japanese market share increases, "U.S. suppliers will lose (car maker) business, but will also lose lucrative (replacement part) sales," because carbuyers will want to stick with manufacturer-approved replacement parts, the researchers say. It's bad enough that the Japanese will import more cars, the report says, but they are also assembling more in the United States in anticipation of import restraints down the road. Production increases are planned at: the New United Motor Manufacturing Inc. (NUMMI), the joint venture between General Motors Corp. and Toyota Motor Corp.; the Nissan Motor Corp N.U.S.A. plant in Smyrna, Tenn.; and the American Honda Motor Co. Inc. plant in Marysville, Ohio. In addition, Mazda
See CITIES, PAGE 26
Parks prosper There's a mini-boom in industrial parks in Southeast Michigan as the auto industry rebounds and high technology industries locate here.
Special report, Page 22 •
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DWIGHT CENDROWSKI
Aviation Group Inc. President Russ Carle says his firm will open a aviation/conference center for businesses Oct. 3 at Oakland-Pontiac Airport. Story, Page 3.
Investors plan $39 million hotel, conference center in Ann Arbor BY AMY BODWIN CRAiN'S DETROIT BUSINESS
In hopes of attracting new convention trade to Ann Arbor, a limited partnership of local investors plans to build a $39 million hotel and conference center at 201 W. Huron St. in downtown Ann Arbor. The partnership is planning a 13-story, 400-room hotel with 60,000 square feet of conference space and a 75-space underground parking lot on a 1.5-acre site called
Huron Plaza. The developers hope to break ground in late December. They are awaiting site plan approval by the city of Ann Arbor for the hotel, which is scheduled for opening in the fall of 1987, said Richard Berger, general partner in the Huron Plaza of Ann Arbor Limited Partnership at 332 E. Washington St., which will own and develop the hotel. See HOTEL, PAGE 7 ~
See WOES, PAGE 5
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Cab companies fare well in city, despite economic fluctuations BY BRADFORD WERNLE CRAiN'S DETROIT BUSINESS
The upheavals that affected Detroit during the last decade left at least one thing unchanged. The city of Detroit is still served by 1,310 taxicabs - the same number set by city ordinance in the 1950s. The number remains the same despite the fact the city lost 20 perc~nt of its population between 1970 and 1980. Despite the population drop, the revived business climate and the expansion of Cobo Hall bode well forDetroit's taxis that have survived the depths of the recession, according to Robert Barnes, executive director of the Metropolitan Taxicab Association, which represents owners of 1,800 cabs in the greater metropolitan area. The faithful, much used and abused taxicab, for many people in mass transit-poor Detroit, remains the only viable form of transportation. As in other
cities, taxicabs here are highly visible, and therefore often controversial representatives of the city they serve. Detroit area critics complain about dirty cabs, Plexiglas shields isolating the drivers from passengers, and uncooperative drivers interested only in hauling passengers back and forth to the airport. Cab owners say they're burdened increasingly by soaring insurance premiums, but point with pride to the fact that Detroit taxi fares remain among the lowest of major U.s. cities. Cab drivers also take pride in their independence. "We're the only form of public transportation that's not subsidized," said Barnes. Detroit isn't really a taxicab town in the traditional sense of the word. Unlike New York City, Detroit's street corners aren't filled with people flagging taxis. The majority of Detroit's cabs are radio dispatched, See CABS, PAGE 26
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MICHAEL E. SAMOJEDEN
Cabbies wait for fares outside the Westin Hotel.