December 26, 2012 - By Lance Farrell
Review Staff Writer
Christmas came early for Orion and Hilite International this year.
Thanks to a five-year tax abatement, Hilite will put a research and development center on the south side of the township. In return, Orion will receive 25 high-wage engineering jobs over the next two years.
Hilite is an automotive supplier with operations in North America, Germany, and China. In business since 1999, Hilite focuses on engine and transmission systems . They supply the cam-phasing system on the Chrysler Pentastar engine and the General Motors' LH-50 and mid-size gas engines for GM as well. Hilite also supplies torque transfer clutches to Borg-Warner and Honda.
HiLite has a facility in Dallas, TX and one in Whitehall, MI. In their new location, at 250 Kay Industrial Drive in Lake Orion, they will focus on design, product development and customer support. Except for prototypes, there will be no manufacturing in the new building.
According to Steve McClung, Senior Director of North American Sales and Customer Support, Hilite expects to add about 25 high-paying jobs. They're "looking for engineers, CAD people and lab personnel," McClung said.
Hilite's interest in the area stems from a desire to better serve their customers, McClung said. As products undergo development, enhancements and modifications can be made quicker if suppliers are nearby. Detroit remains the automotive manufacturing center of the world, so it makes sense for Hilite to be near that engineering loop.
In addition to logistical expedience, the Detroit-metro area makes sense for Hilite because it provides a ready supply of skilled labor.
"All the design and development for the Detroit Three is still done in Detroit, so when we're looking to grow our business, we need to add qualified engineers. In order to do that, the talent pool is going to be better here," McClung explained.
Workers are less likely to relocate out of Detroit to Dallas or Whitehall, so Lake Orion helps Hilite in this way, he said.
The tax abatement is a boon for Hilite as well, and was an important factor in their decision to come to Orion. The exemption will effectively cut their millage rate in half, at $22,000 per year. Hilite stands to save $100, 000 over the life of the tax reprieve.
"Our owners have other companies in the metro Detroit area. From Hi-Lite's perspective, we wanted to go where we could get the most benefit from tax relief."
With the Orion abatement now approved, Hilite can ramp up its Michigan operations.
Not only will Hilite hire 25 new engineers, they are also investing three million dollars to establish its Orion lab. This money will pay for items such as cooling lines, building infrastructure, test equipment, and other changes needed in the plant.
Only 25 jobs are budgeted for the next two years, but "as we grow our business," McClung said, "there would be most likely needs for more program managers, for quality-control personnel, for sales people too,"
The tax abatement extends for five years, and since Orion has proven to be business friendly, Hilite will likely be here for a while.
"Certainly it is our plan to stay in the area and continue to support our customers the way that we need to," McClung said.
They have a five-year lease with an option to extend their lease or to purchase the building. "This is not a short-term thing," McClung insisted. "It would be great if we could have more Lake Orion people join our company."
Hilite is pleased to receive the exemption, and Oakland County is glad to have the business locate in Orion.
"We're very excited that an international company with the strength of HiLite has chosen Oakland County, " said Matthew Gibb, Deputy Oakland County Executive. Gibb, former Orion Township supervisor, said he was even more pleased that Orion Township was in a position to attract Hilite. "They were organized, they were knowledgeable about the process and were able to attack that opportunity very quickly for them."
Gibbs thought the abatement proceedings were a harbinger of good things to come for Orion. Hilite was welcomed warmly at the township meetings, and this "created a very amicable atmosphere which will now permeate out to other companies who will say 'Wow. That's a community that gets it.'"
Gibbs pointed to the halo affect employers like Hilite bring to a region. Not only will Hilite bring 25 engineers, these engineers bring 25 families. These 25 families need housing, schools, restaurants, shopping—a host of commercial opportunities that spill out into a local economy.
"The small sacrifice of what a tax abatement represents is a much bigger payoff in the economic picture. That's what Orion did, and the county is very pleased with the way Orion has positioned itself," said Gibbs.
"This is a lot of what I've talked about all summer long - taking existing vacant buildings and getting things going again," explained Orion Township supervisor Chris Barnett.
The southern region of Orion Township has been pre-approved for just such developments, Barnett explained, and he's ready to extend the offer to other businesses looking to locate in Orion.
"I'm excited, and we're looking for the next one to come."
For more information about the tax abatement check with the Orion Township offices at 248-391-0304. You can learn more about Hilite at hilite.com.