GM may move 1,500 jobs from Renaissance Center

November 16, 2009

GM may move 1,500 jobs from Renaissance Center

GM seeks state tax breaks to keep workers in Detroit

BY TIM HIGGINS, JOHN GALLAGHER and TOM WALSH
FREE PRESS BUSINESS WRITERS

General Motors is seeking state tax breaks to keep about 2,500 corporate staff positions at its downtown Detroit Renaissance Center headquarters, the Free Press has learned.

GM has an estimated 4,000 workers at the complex. In a blow to Detroit, the 37% of employees not covered by the tax credits — roughly 1,500 — could be transferred to other GM facilities in southeastern Michigan, including the Warren Technical Center, a person familiar with the discussion said.

Spokesman Greg Martin said GM is continuing to evaluate plans to consolidate its downsized workforce. "But we have nothing to announce at this time," he said.

GM CEO Fritz Henderson confirmed Monday that a decision is imminent, though he declined to say how many people would be moving and stressed that the RenCen would remain GM’s headquarters.

2,500 could stay at RenCen, 1,500 may relocate

"We’ll have some people move from the Renaissance Center to the Warren Tech Center, but the Renaissance Center will still maintain a very sizable presence and this will be our headquarters," Henderson said.
 

He declined to say how many workers would move, though the Free Press later in the day learned that up to 1,500 could be relocated to various facilities.
 

GM wants to consolidate its southeast Michigan operations into four locations. GM wants to locate functions of the company that should be working together in proximity with each other, such as having marketing people work near product designers, people familiar with GM’s thinking said.
 

The corporate functions of GM, such as legal and finance, are expected to stay at the RenCen. It would further weaken Detroit’s already struggling commercial real estate market where office vacancies are running at 30% or higher.
 

GM bought the RenCen for its world headquarters in 1996, paying a little more than $70 million for it, and then spent eight years and about $500 million remaking it.
 

Joseph Vicari, president and CEO of the Andiamo Restaurant Group, said his Andiamo restaurant in the RenCen would be hurt by further GM cutbacks even more than it already has been.
 

"I’m disappointed for sure if this is going to happen. We were romanced by General Motors to come down there. We’re actually partners with them in our restaurant. It would be kind of devastating to lose another 1,500 but I know they’re trying to survive," he said Monday. Vicari said business for the RenCen site is down more than 20%.
 

Meanwhile, another restaurant in the RenCen, Seldom Blues, filed for Chapter 11 bankruptcy protection recently. Its owner blamed the GM cutbacks for lost business.
 

Detroit Mayor Dave Bing said Monday night that he was not aware of the latest details of GM’s plans at the RenCen, adding that he expects to meet today with George Jackson, president of the Detroit Economic Growth Corp., who has been handling negotiations with GM and state economic development officials.

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