ALTe’s New Factory Helps Give Michigan a Future Beyond Batteries

4/26/10

ALTe, an Auburn Hills, MI-based developer of electric propulsion systems, knows that if the future of the automobile is truly hybrid and electric, then a great deal more than just the battery is going to have to change. And while state government tax incentive policy, and news media reports, have emphasized automotive batteries, just as important is the powertrain, which is automotive-speak for the whole shebang that generates power and moves the wheels.

Armed with an $8.4 million tax credit over seven years, approved in February by the Michigan Economic Development Corporation, ALTe cut the ribbon on a new 185,000-square-foot development and manufacturing facility in Auburn Hills on April 12. At full production, the facility will produce up to 90,000 electric powertrains each year and create more than 300 jobs, the company says.

Michigan Governor Jennifer Granholm, in announcing the tax credits, said that the new ALTe plant helps boost “our ongoing efforts to diversify the state’s economy, and shows that businesses are continuing to choose Michigan because of our highly-skilled workers and competitive business climate.”

It’s unclear why Granholm chose to portray ALTe as an example of diversification, unless she considers any new automotive technology a significant departure from Michigan’s old single-industry economy.

After the ribbon cutting, ALTe, whose name is a shortened combination of the words “alternative energy,” demonstrated its new Range Extended Electric Powertrain (REEP) prototype vehicle.

It is appropriate, by the way, that this company first unveiled its new technology at a National Truck Equipment Association show in March. ALTe did not choose a special cleantech venue for its coming-out party, but wanted to establish itself right away as a workhorse ready to serve the mainstream automotive supply chain.

Such integration into existing processes is incredibly important as the automotive industry changes here in Michigan. Last year, in a different context, I spoke to David Cole, head of the influential Center for Automotive Research in Ann Arbor, MI, who told me that while Michigan is doing the right thing by focusing on battery manufacturing for the next generation of electric and hybrid automobiles, the state should also be careful what it wishes for.

“If we get electrification of the powertrain—if that goes big—the impact on the transmission business, the general powertrain business here could be hit very, very hard,” Cole said. “We could lose some very important manufacturing and we would at least want the replacement manufacturing being here rather than someplace else.”

ALTe’s new Auburn Hills plant is a step toward building that replacement capacity in Michigan.

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