Weekly Area Information Report
Chandler to be home to GM’s newest IT innovation center
General Motors’ new IT innovation center planned for Chandler will mean 1,000 new jobs in metro Phoenix, but the work there will have a global reach.
Software developers at the center will be building systems and applications to streamline GM’s manufacturing operations and connect its dealerships around the world. They will create technology to give drivers new experiences, from the moment they step onto the showroom floor, where customers can choose specs for a new vehicle on an iPad, to the first time they slide behind the wheel of a hybrid or electric vehicle.
General Motors, which announced the new facility in Chandler Wednesday, is the second marquee company in two days to announce a big hiring push in metro Phoenix. USAA, a financial-services firm, announced Tuesday that it plans to hire 1,000 workers over three years and expand its north Phoenix facility.
The GM jobs will be created over the next three to five years, and General Motors will receive millions of dollars in incentives from Chandler and the state. In return, state officials project an economic impact of about $580million over the next five years.
The technology to be developed will touch every facet of the automaker’s business, from marketing and sales to manufacturing and engineering, Randy Mott, GM’s chief information officer, told The Arizona Republic.
“The applications built in these centers will be global, and the intent is, certainly, we will leverage those around the world and all of the markets we are in,” Mott said. “We think these are the best jobs in the IT industry today.”
This is the fourth such center for GM, which recently has opened similar information-technology hubs in Austin; Roswell, Ga.; and Warren, Mich.
For years, GM outsourced almost all of its IT operations, Mott said. But early last year, the company decided to bring operations in-house.
The pivot on IT is a small piece of the massive restructuring GM has undergone since filing for bankruptcy and being rescued by the federal government in 2009.
While GM still deals with criticism over the bailout, it has been profitable for 12 straight quarters.
General Motors plans to hire 4,000 IT workers over the next three to five years to staff the four centers.
In choosing its locations, the automaker established clear needs: The sites needed to be geographically diverse, close to major colleges and universities and have an existing quality workforce.
In his speech Wednesday announcing the center, Mott specifically mentioned the university connections that can be built here.
“At GM, we are very excited about the world-class college and university resources and deep pool of technical expertise located here in the Phoenix metropolitan area,” he said.
About 30 to 35 percent of the new hires will be recent college grads, he said in an interview. General Motors will be looking to Arizona State University and University of Arizona to help fill those needs. It will also be recruiting graduates from a handful of universities in neighboring states.
General Motors is building its $21million IT center just south of the Chandler Fashion Center, where Loops 101 and 202 connect. But hiring will begin in April, which means that operations will start in a temporary building in Phoenix.
Chandler has carved out a tech niche in the Valley, particularly along the Price Road corridor. In August, Intel Corp. announced a $300million research and development expansion there, and Chandler Mayor Jay Tibshraeny said he viewed the GM presence as carrying similar magnitude.
“We have been talking with them since last summer,” he said. “This is going to have other worldwide companies saying there is a reason this is happening, and maybe we should look at Chandler or maybe Arizona.”
The Arizona Commerce Authority is aggressively targeting high-tech jobs, and Gov. Jan Brewer said GM’s move to the Valley reflects the authority’s work and recent legislative changes to lower corporate taxes and provide tax breaks for job creation.
“I believe it speaks volumes about how we have done such a good job here in Arizona in regards to leading the country in so many different issues,” she said in an interview. “We’ve had lean and predictable regulations that they don’t find anywhere else, low taxes and certainly an educated workforce.”
The state is also offering incentives to GM, said Sandra Watson, president and CEO of the Arizona Commerce Authority.
General Motors will receive a $1.3million grant from the Arizona Competes fund, which is used to attract or retain businesses.
General Motors will also receive a tax credit, as much as $9,000 spread over three years, for each job created, and a job training tax credit worth as much as $5,000 for each job created.
“I think, all and all, Arizona is well-positioned to encourage companies like GM and others to continue to grow and operate here,” Watson said.
Chandler is paying $1,200 for each of the first 750 jobs GM creates. After that, it will pay $900 for the next 250 jobs, said Christine Mackay, the city’s economic-development director.
By Josh Brodesky
The Republic | azcentral.com
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