DETROIT -- An Italian automotive supplier plans to build a new manufacturing plant in Detroit.
Tiberina Group, a supplier of body-in-white and metal stampings for the auto industry, acquired 10 acres of land at the former American Axle & Manufacturing Holdings site on Holbrook Drive on the city's border with Hamtramck.
Tiberina purchased the land from Cleveland-based Industrial Commercial Properties LLC and California-based Industrial Realty Group LLC, who themselves acquired most of American Axle's 2.5 million-square-foot Detroit Manufacturing Complex in 2014. As part of that deal, American Axle demolished about 1.9 million square feet of the complex and leased back about 360,000 square feet.
The size of the manufacturing plant Tiberina plans to build on the site or what products it will supply to whom remains unknown at this time. Representatives from Tiberina and the real estate companies did not immediately respond to inquiries.
"Tiberina views this as a strategic location, which is ideal for supporting their automotive clients," Austin Semarjian, vice president of acquistion and leasing for Industrial Commercial Properties, said in a press release. "The details are still being worked out such as size and scope of the new plant, but this land purchase indicates their commitment to the project."
No tax abatements or incentives were announced yet.
A new plant would represent the first production operations on the site since American Axle closed down the complex in 2012. American Axle closed the plant after labor negotiations broke down with the UAW and the supplier moved production to its Three Rivers and Mexico plants.
Detroit has largely been void of new manufacturing activity until recently. Illinois-based Flex-N-Gate opened last year its $160 million plant in the I-94 Industrial Park, less than three miles from the Tiberina property.
FCA also plans to invest nearly $3.5 billion at its Mack Avenue and Jefferson North plants. The plan will fuse together two engine plants and convert them into an assembly plant -- the first new plant in Detroit since Chrysler's Jefferson North Assembly Plant came online in 1992.
That project is expected to create nearly 5,000 jobs.
Detroit Mayor Mike Duggan hopes the FCA deal will draw suppliers to the city, as may be evident with Tiberina. But experts are cautious about a glut of new development because of the plant.
Kristin Dziczek, vice president of industry, labor and economics at the Ann Arbor-based Center for Automotive Research, said while Detroit is now a more attractive investment location, the metro region's already full of manufacturing plants that could support FCA.
"There's a better chance of having auto suppliers move to Detroit now than there was before the FCA deal was completed," Dziczek said. "Contracts are already being let out for the new product, but a lot will go to existing suppliers who may be able to retain current employment levels or might need to hire and expand (where they are). Note that many of these suppliers are in Michigan, Ohio, Indiana, Ontario already."
