Economic Development Futures Journal

Thursday, December 08, 2005

counter statistics

Chrysler Looking at New Investment in St. Louis Area

The state of Missouri and the Chrysler Group of DaimlerChrysler AG have supposedly reached a deal on a multimillion-dollar incentives package needed to attract a $1 billion investment at the automaker's Fenton assembly plants, according to a recent news article.

Though details weren't available, Missouri Gov. Matt Blunt plans to hold a news conference this coming Monday to unveil the package.

The Chrysler investment would be a boon to the St. Louis region's economy. Chrysler had earlier told Fenton city officials that the two assembly plants would be at risk of closure in the future without a significant investment.

My advice to Missouri economic developers working this deal is to look at the "big picture" when it comes to automotive and be certain that the long term payoff from the multimillion dollar incentive package is going to pay off.

posted by Don Iannone, D.Div., Ph.D. at Thursday, December 08, 2005

4 Comments:

  • Streeter,

    Are you Dick Streeter from Florida?

    Interesting observation about ED Futures being a classroom. I suppose it could be that. It is certainly a place that reflects what I observe daily about economic development.

    Thanks for stopping by.

    Don

    By Blogger Don Iannone, D.Div., Ph.D., at 2:43 AM  

  • Don, your comments on automotive, airline, and the long view are well taken. Yet, the ideas of folks like Porter suggest that no advantage is ever permanent. If a region refuses to make the investments to entice yet more investment from the private sector in new plants and technology isn't it conceding the race? Don't the rules of competitiveness and productivity apply in that sense as well?

    By Anonymous Anonymous, at 9:59 PM  

  • Streeter, Good to have you at EDF. Stop by as often as you like.

    Best wishes,

    Don

    By Blogger Don Iannone, D.Div., Ph.D., at 4:25 AM  

  • Steve,

    Excellent point, and yes areas must reinvest to stay competitive. My concern with the economic development model, as it stands, is that it is still too much subsidy-based and not strategic investment-driven.

    We give money to companies without any clear investment return. And businesses approach communities for a "break," when they should be transforming themselves. Many are still prone to avoiding change, passing the buck, and laying the blame on others, including the places they operate in, instead of assuming full responsibility for who and what they are. It's not easy. I know that, but ED makes it too easy for businesses to slide on by.

    I am very concerned by what I see in many of our most largest industries, including those you mention. I am a globalist, but I don't think we have the right policy and strategy infrastructure to produce more prosperity as productivity and innovation increase. We are becoming poorer and not richer. That is my main concern.

    Stay tuned.

    Don

    By Blogger Don Iannone, D.Div., Ph.D., at 4:35 AM  

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