EAST LANSING – A German company plans to invest more than $26 million in the city and create 46 high-paying jobs following City Council’s approval of economic incentives Tuesday night.
ATESTEO North America Inc., a subsidiary of ATESTEO and the IHO Group that works with automotive manufacturers to develop and test drivetrains, plans to make East Lansing its North American headquarters with a long-term lease and expansion plans at 3400 West Road.
The company will spend about $700,000 in building improvements, and $26 million in machinery and equipment in the first five years. It will add 46 new jobs within its first three years operating — mostly engineers, technicians, mechanics and electricians — with average salaries of more than $69,000, according to East Lansing’s website.
“By establishing our North American headquarters, we are close to the automakers and automotive suppliers in Michigan and the United States,” ATESTEO CEO Tim Willers said in a press release. “They can test their drivetrains on our test benches right here in East Lansing. We thank the city of East Lansing for their openness and for the opportunity to locate our company in (East) Lansing. We look forward to a bright future together in this beautiful innovative region with a long automotive tradition.”
ATESTEO, as part of the IHO Group, started in 1986 to provide testing services for drivetrains, the system in a motor vehicle that connects the transmission to the drive axles.
The company began serving the e-Mobility industry in 2008 and provides testing services for hybrid and fully electrified automotive drivetrains and components. ATESTEO North America Inc. was established in 2022.
Martin Börner, head of marketing and communication for the company, said in an email that the company plans to open its East Lansing facility in March 2023.
“In the meantime, we are expanding our buildings, facilities and workshop, and transferring our high-tech test benches from Germany to the new location,” he said. “We plan to start with 10 test benches and increase the number of test benches step by step to 20 test benches.”
IHO Group employs about 750 technical staff in Germany, China and Japan and operates more than 160 test benches worldwide, which test transmissions as a subassembly or as part of the entire vehicle, according to the company’s website.
The company wanted an East Lansing location because of its proximity to and partnership with Michigan State University and Lansing Community College, its central location in Michigan and automotive synergies, according to a Lansing Economic Area Partnership presentation.
However, to locate in East Lansing, the company requested the city:
If the company stops doing business at the East Lansing facility prior to Dec. 30, 2032, its tax exemptions will be rescinded. All abated taxes will become immediately due, according to the resolutions passed by City Council.
The project is also receiving a $400,000 Michigan Business Development Program performance-based grant from the Michigan Strategic Fund, according to a press release.
City Council vote to approve all three incentive requests, with Councilmember Lisa Babcock casting the sole dissenting vote after noting the city levies taxes to cover the cost of services for its great amenities.
“I would never have the audacity to expect someone coming here to give me 50% of their future earnings,” she said.
East Lansing Mayor Ron Bacon spoke positively of the project, stating it’s aligned with the city’s strategic priorities for business attraction and he’s attracted to this type of regional investment in general.
“Obviously this is the future,” he said.
Contact Bryce Airgood at 517-267-0448 or firstname.lastname@example.org. Follow her on Twitter @bairgood123.