BATTLE CREEK — Concerns over national security could spark wider access to a $100 billion industry for West Michigan manufacturers.
That’s if Battle Creek is chosen as the site for the country’s next intercontinental ballistic missile defense system.
Fort Custer Training Center is one of three military bases in the eastern Midwest and East Coast areas that is in the running to house the military’s next generation of ground-based interceptor ballistic missiles, more commonly referred to as the Ground-based Midcourse Defense (GMD) system.
Aerospace industry experts estimate the project will create more than $3.2 billion in total economic impact in Southwest Michigan if it locates here, said Dan Shanahan, senior manager of GMD systems for Boeing’s Strategic Missiles and Defense Systems division. It could also open new markets in the aerospace and defense sectors for local manufacturers.
“Over $100 billion has been spent on missile defense over the course of our history and companies here need to have a slice of that,” Shanahan said.
Shanahan spoke to a group of West Michigan suppliers and other stakeholders regarding the GMD project in a meeting last month hosted by Boeing and the Michigan Aerospace Manufacturers Association (MAMA).
Boeing manufactures the missiles for the GMD program that are used to intercept and destroy nuclear weapon-equipped ballistic missiles.
“We’ve figured out how to hit a bullet with another bullet in space,” Shanahan said.
With the amount of technology involved in accurately intercepting a missile fired from across the globe, Boeing’s GMDs and their complex system of components offer suppliers numerous opportunities to work with the company, sources said.
“This will probably be the largest opportunity for suppliers for any project in the aerospace and defense industry on the west side of the state for decades,” said Gavin Brown, executive director of MAMA. “The reason we are so confident that the site selection will be in Michigan is because of what the state has to offer with its business and political structure.”
At Kalamazoo-based Schupan & Sons Inc., a metal recycler and manufacturer, the company hopes to capitalize on business from working in close proximity to a large manufacturer like Boeing, said President John Barry. Schupan could then build off those relationships to tap into the defense industry if and when the GMD project moves forward.
“If that project went through, it would be a major shot in the arm to the region’s economy,” Barry said. “There’s more opportunity for us on the Boeing side. We already supply a lot of raw material to MAMA members for aerospace and make some parts and pieces as well.”
HAVING AN IMPACT
Beyond providing local suppliers for missiles and other aerospace components, West Michigan manufacturers can also help drive down costs — one of the largest challenges the GMD project faces amid falling defense spending, Brown said.
Each missile costs upwards of $80 million and military procedures call for four defensive missiles to be fired per target. Shanahan said Boeing is attempting to lower the cost to between $35 million and $40 million per missile with a new design in an effort to make the program more palatable to lawmakers in an era of constrained defense budgets.
“Michigan is poised in its manufacturing process as well as its expertise to take cost out,” Brown said. “We will, through our supply chain technologies, be able to provide the missile defense for less cost than what they’re applying elsewhere.”
Besides manufacturers, area economic developers also support the Fort Custer project, which they believe would help grow Michigan’s already strong aerospace sector.
Beyond benefiting West Michigan manufacturers, the project would also generate new business for construction firms, general contractors and numerous other companies in the region, sources said.
A similar GMD project in 2007 at Fort Greely in Alaska, approximately 100 miles southeast of Fairbanks, generated $246 million in total economic development and employed 323 Alaskan workers, according to data from Boeing.
Economic developers in Southwest Michigan believe a similar project at Fort Custer could result in similar economic development activity for the region.
“I think Michigan in general and Southwest Michigan in particular have quite the defense supplier network where maybe they already supply in one form or another to Boeing,” said Joe Sobieralski, interim president and CEO of Battle Creek Unlimited. “This really elevates the companies in the region that have an opportunity to get involved with the initiative.”
LONG ROAD AHEAD
Proponents of the GMD project at Fort Custer, which includes a cadre of industry groups, state politicians, economic developers and other stakeholders, say Battle Creek is ideally suited for the missile defense site.
Between the competing sites at Camp Ravenna Joint Military Training Center in Ohio and Fort Drum in New York, Fort Custer offers the most cost-effective construction costs and doesn’t fall into environmental compliance issues, said John Simmons, managing partner at The Roosevelt Group, a Washington, D.C.-based consultancy working with Battle Creek Unlimited to lure the project to Fort Custer.
Despite the overall optimism for Fort Custer’s chances of being selected as the winning site, sources say the project still must clear some major impediments.
One of the major challenges to the project is cost. Constructing the missile site itself would cost $3.5 billion, on top of the cost of stocking it with 60 interceptor missiles, Simmons said.
Those costs come at a time when the Department of Defense has been forced to make budget cuts. The military plans to cut its construction budget alone by $1.1 billion next year, leaving less room for new projects, according to Simmons.
“We have some serious budget challenges before we even get to (choosing) this next site,” he said.
Moreover, President Obama is unlikely to make a decision on the project during the remainder of his term in office, leaving it up in the air until after the election.
But even if the project falls through because of budget constraints or if another site is chosen, West Michigan manufacturers can still tap into opportunities in the defense industry.
“Artificial intelligence, autonomous landing, autonomous vehicles, this is where you guys want to be,” Simmons said. “Just like plastics in the ’60s, artificial intelligence is where we are spending money.”