DETROIT -- Auto supplier Dakkota Integrated Systems LLC announced Tuesday that it plans to build a new plant employing 625 people on former Detroit school properties to serve Fiat Chrysler Automobiles' new assembly plant in the city.
The company plans to build a $55 million, 600,000-square-foot facility on 32 acres at the former Kettering High School property along Van Dyke Avenue and nearby Rose Elementary School site, which the school district sold for $2.6 million last month. Officials from Dakkota, the city of Detroit and partners announced the project at the Kettering High School site late Tuesday morning.
The news comes as the city angles for suppliers to expand in Detroit alongside Fiat Crysler Automobiles' $2.5 billion investment and 5,000 new automotive jobs planned at two east-side plants. Detroit Mayor Mike Duggan has previously hinted that the city was in talks with logistics and supplier teams to create more jobs on top of FCA's commitment.
Dakkota Integrated Systems was launched in 2001 as a joint venture between majority partner Rush Group LLC, owned by trucking and auto supply entrepreneur Andra Rush, and auto supplier Magna International Inc.
It manages assembly and sequencing of integrated automotive interiors for original equipment manufacturers.
Detroit Mayor Mike Duggan said Dakkota has pledged to give Detroiters first priority for the new jobs the same way FCA has pledged to for its expansion at Mack Avenue and modernization of its Jefferson North Assembly Plant. Detroiters interested in getting prioritized access to interviews must get on a list by registering with city employment growth initiative Detroit at Work and attending a job readiness event.
FCA is allowing Detroiters to apply for jobs at its two plants before the general public -- a commitment announced as part of a $35 million community benefits agreement with the city. City Council members including Raquel Castañeda-López have questioned why FCA didn't make a legally binding commitment to ensure Detroiters got a defined percentage of hires.
Kettering closed in 2012 and Rose in 2006 due to declining student enrollment, according to Detroit Public Schools Community District records.
The Detroit Brownfield Redevelopment Authority (DRBA), an arm of city government, recently purchased the 27.55-acre Kettering High School site at 6101 Van Dyke Ave. and the 6.3-acre former Rose Elementary School at 5830 Field St. for $2.6 million. The Detroit Public Schools Community District Board of Education approved the sale on June 18.
According to a memo to school board members, the DRBA's cash offer was $300,000 above the appraised value of the land and that both buildings would need $24 million in repairs and renovations due to "sustained significant vandalism."
"The future use of the Kettering property is to serve as a light manufacturing/industrial site for Fiat-Chrysler," according to the memo to school board members. "The city is attempting to site these suppliers within close proximity of the plants."
Duggan has hinted in recent weeks that an FCA supplier deal was in the works.
Dakkota will be seeking city planning commission approval to rezone the land from residential to manufacturing.
The Duggan administration also will be asking the Michigan Strategic Fund and City Council for a 10-year Detroit Next Michigan Development Corporation Renaissance Zone abatement on 100 percent of all real property tax, corporate income taxes and utility user taxes.
Detroit gave similar tax breaks to auto supplier Flex-N-Gate to build its new $160 million plant in the I-94 Industrial Park, which supplies parts to Ford Motor Co.'s Michigan Assembly Plant in Wayne.
Construction to convert FCA's two Mack Avenue engine plants has been under way for a month.
As part of a wider Southeast Michigan deal, FCA will invest $1.6 billion to convert the idled Mack Avenue Engine Complex to build the next-generation Jeep Grand Cherokee and a new three-row full-size Jeep SUV, starting in late 2020, creating 3,850 new jobs; and will invest $900 million at Jefferson North Assembly Plant in Detroit to update the plant for Dodge Durango and the Wagoneer, creating an expected 1,100 new jobs.
— Kirk Pinho contributed to this report.