DaimlerChrysler eyes Ford proving grounds

Aaron Royster
Miner Staff Writer

KINGMAN - The state of Arizona, Mohave County, Kingman and a Lake Havasu City economic group are working together on an incentive package that could reach $500,000 to lure DaimlerChrysler to the Ford Proving Grounds in Yucca.

According to the Mohave County Board of Supervisors and Kingman City Council agendas for Monday, the Chrysler Group is interested in purchasing the 3,840-acre site. Representatives with the vehicle manufacture will go before both government groups Monday, DaimlerChrysler spokeswoman Mary Beth Halprin said.

"We hope to make a final decision within the next two quarters," Halprin said.

DaimlerChrysler currently runs a testing facility out of Wittmann, Ariz., which they sold in late 2005. Since then, the manufacturer has been leasing the facility and looking into various options for a future testing facility.

"I know it would be good news to the community if we did choose that site (in Yucca)," Halprin said.

Halprin said their main three options are to take over an existing outside facility, build a new facility or utilize their other existing facilities. No matter what decision they make, they have to vacate their current facility in Wittmann by mid-year 2008.

If DaimlerChrysler were to purchase the site, it would bring at least 75 jobs and spur the capital investment of approximately $10 million in new test facilities and infrastructure, Kingman Financial Services Director Coral Loyd stated in an agenda memo to Council.

Loyd added that if Ford Motor Company decided to close the site, the agreement would become null and void.

The Arizona Department of Commerce and Economic Development Commission will contribute up to $250,000 to the incentive, matching whatever the other parties contribute. It is the same amount they offered Ford to have them keep the Yucca site open in 2006.

In the event that none of the other local groups contributed, the CEDC is also offering to loan the county $250,000, which would be repaid over 10 years at a rate of 4.5 percent with no penalty for early payment.

Mohave County would contribute up to $150,000 to the incentive, the amount they offered Ford at the same time as the CEDC.

Kingman would contribute up to $60,000 and the Lake Havasu City Partnership for Economic Development would contribute up to $40,000, both of which are the same amount offered Ford last year.

The Lake Havasu City PED board of directors was going to decide on the contribution Tuesday at their retreat but lacked enough members for a quorum. Lake Havasu City PED President and CEO Gary Kellogg said he expects it to be approved by their Monday deadline.

Mohave County and Kingman have approval of the incentives on their Monday agendas. The staffs for the county and city have recommended approval.

Some agencies' participation is contingent upon others. If Kingman and the Lake Havasu City PED do not approve their parts, the Board of Supervisors won't participate and the CEDC will only match the amount from the local groups.

In a request for Board action from Mohave County Deputy Director of Economic Development Jonas Peterson, he stated that DaimlerChrysler is also considering their Chelsea, Mich., and Laredo, Texas, sites for hot weather testing. Peterson concurs with Loyd's estimate of the site creating at least 75 jobs and spurring $10 million in capital investment.

In May, Ford spokesman Said Deep told the Miner they may significantly scale back operations at the site or sell it to another company. The site has more than 50 miles of test roads and approximately 109,000 square feet of building area.

"Nothing is finalized," Deep said. "We're just talking with a potential bidder."

Ford reported a loss of $12.7 billion last year and continues to struggle to become a smaller, more streamlined manufacturer. They plan to eliminate more than 40,000 jobs and stop operations at 16 factories in North America by 2012.