NEWAYGO — A West Michigan Tier I automotive supplier is investing $45 million into a 175,000-square-foot facility expansion designed to improve workflow and efficiency.
For Magna Mirrors of America Inc., a manufacturer of automotive handles, mirrors and fuel doors, the expansion comes as the company’s current facility in Newaygo is “out of space.”
To alleviate that constraint, the company is investing millions of dollars to double the size of its Newaygo operations in a project that is expected to create up to 50 new jobs, General Manager Daniel Groszkiewicz told MiBiz.
The expansion, which is aimed at building a better workflow in the factory and increasing production efficiencies, is expected to come online in fall of 2019.
“We’ve been trying to expand for three or four years now,” Groszkiewicz said. “Quite frankly, we don’t have any other space to go.”
According to Groszkiewicz, the company’s facility expansion will house its assembly and warehouse operations, and make room for roughly seven to eight new presses, bringing the total at the location to more than 80 machines.
Grandville-based The Architectural Group Inc. designed the new facility; Holland-based GDK Construction Co. is serving as construction manager.
In addition to creating efficiencies, the added space should also improve safety compared to the currently cramped facility, Groszkiewicz said.
“The cells are so close to each other that I think we are adding risk to our plant, which I don’t like,” he said.
Groszkiewicz said the company has seen growth out of its Newaygo plant, but the space constraints had become a pinch point.
“We have creatively done everything that we can conceivably do,” he said. “We’ve rented a warehouse across the street, we have trailers and cargo containers and all of those things that are making our plant less and less efficient. I’m adding labor to offset the inefficiencies that I have on the storage side.”
The supplier, which also has plants in Alto, Grand Haven and Holland, eyes a steady growth curve in Newaygo over the next several years with the addition, according to Groszkiewicz. With the expansion, “our flow improves, our labor efficiency improves, our safety improves, (and) our space to grow improves,” he said.
Magna Mirrors is a division of Aurora, Ontario-based Magna International Inc., one of the largest global auto suppliers. The company employs 168,000 people across 335 plants worldwide, and generated sales of $38.9 billion in 2017.
To support the expansion, the Michigan Economic Development Corp. provided Magna Mirrors with a $448,000 performance-based grant from the Michigan Business Development Program. The City of Newaygo also offered a 50-percent property tax abatement for the expansion.
Currently, Magna employs 1,100 people at its Newaygo plant. Some of the job openings with the new expansion include machine operators, launch engineers and robot operators.
The expansion comes as light vehicle sales have started to level off. Analysts at IHS Markit project sales of 17 million units this year, down from 17.2 million units in 2017, with the market dipping to 16.6 million units by 2020.
Analysts say the vehicle mix also is changing, as more customers flock to trucks, crossovers and SUVs instead of sedans.
That shift comes as good news for Magna, a traditionally “truck and SUV” heavy supplier, Groszkiewicz said.