Nexteer Automotive has today (31 October) announced a US$150m investment retaining 1,000 jobs at its Saginaw, Michigan operations driven by what it says is increasing customer demand for fuel-efficient electronic power steering (EPS) technology.

“This significant investment is a reflection of Nexteer’s ongoing commitment to the Great Lakes Bay Region and the state of Michigan and recognition of the work being done here by our highly skilled technical and UAW-represented production teams,” said Nexteer president and CEO Robert Remenar.

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“New, long-term customer contracts through 2018, including General Motor’s next generation full-size pick-up, will add revenue that benefits all product lines, allowing us to upgrade and expand our testing, manufacturing and innovation capabilities.”

Michigan Governor Rick Synder said: “Nexteer is a showcase of Michigan’s world-class technology and manufacturing capabilities. Today’s announcement offers proof positive that foreign direct investment can combine with our own valuable industrial assets for new economic vitality for Michigan.

“This is the message I took to Asia: serious investors know Michigan’s technology leadership and workforce advantages offer very real growth opportunities for all of us.”

A major focus of the investment will be related to expanding and upgrading Nexteer’s testing and validation capabilities. The company’s Vehicle Evaluation Center (VEC), which is part of Nexteer’s Saginaw operations, will undergo an expansion to allow for additional real-world simulations.

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Nexteer’s oldest plant (Plant 3), which currently produces pumps, will receive major upgrades with the addition of new high-tech EPS lines. Around 45% of the sourcing for the EPS investment will be to Michigan-based businesses. Nexteer has EPS systems on a full range of vehicle segments, sizes and classes, from compact cars to full-size trucks. In 2010, the company produced the world’s first 12-volt EPS system for the full-size truck market.

“Nexteer is experiencing significant growth and demand for its EPS systems globally,” said Nexteer senior vice president, engineering and global steering business line Mike Richardson.

“Less than ten years ago EPS represented 4% of our annual sales, last year it was nearly 30% and by 2015 we are anticipating that well over half of Nexteer sales will be attributed to EPS.”

Nexteer is the second largest employer in Saginaw County and currently employs 3,780 individuals. Technical staff and production employment at Nexteer’s Saginaw operations has grown by 20% since Pacific Century Motors acquired Nexteer in July, 2010.

“Nexteer has been on an aggressive global expansion and investment path for the past couple of years,” added Remenar. “In addition to Saginaw, Nexteer has continued to expand its operations in India, Brazil, Poland, China and Mexico.”