UW on Detroit

Since Ford, GM and Chrysler are no longer the world’s largest automakers, the term “Detroit 3″ has become more common than “Big 3.”

But news this week says it may soon be the Detroit 2.

General Motors Corp. could swallow Chrysler LLC and end the Auburn Hills automaker’s 83-year existence under one scenario being discussed by GM and Chrysler’s owner, Cerberus Capital Management LP, said a source briefed on the talks.

…

Besides the Jeep brand and Chrysler’s minivans, the company has few assets of value to its bigger rival, he said.

I’ve always thought that Detroit would eventually just have one car company (GM) and that would be the end of it. It looks like that may be the way this is going, although I’m sure there are many in Auburn Hills that would like to keep it from happening.

GM would be losing a key competitor by doing this, so it’s probably a good move for them in that sense. The Jeep brand is probably the only major SUV brand that will remain popular if gas prices continue to hover between $3 and $4–and with gas falling, they may do even better.

And I would venture to guess that it’s better to have two companies working on a green car versus three.

But I can’t stress how much this could change Detroit. Thousands of people work for Chrysler HQ and at an enormous Chrysler plant on Detroit’s east side. Some would get jobs with GM, but the VAST majority would be out of jobs. Dozens of “Chrysler-Jeep Superstores” would close.

The Western Suburbs, where many of the high up Chrysler people live, would see more foreclosures of expensive homes that nobody can buy anymore, and the Northern suburbs would see thousands of foreclosures due to lost assembly line jobs. This could lead to instability even in Chase and Bank of America, Detroit’s two largest lenders, and the only two major banks in the U.S. that have remained stable through this economic crisis.

I’m torn. This could help save GM, which Detroit would be nothing without, but it could also lead to a mass exodus from the area and (further) economic instability.

I do not envy the people making this decision, nor the people who will have to deal with its consequences.

Fantastic news out of the Motor City today

Hendrix, who turned 58 today, said he plans to run in February’s special primary election for Detroit mayor, joining a half-dozen well-known candidates interested in leading Detroit after Kwame Kilpatrick’s resignation and criminal plea.

Hendrix said he will focus on three core issues: bringing integrity back to the office, beefing up the police force to thwart crime and re-establishing long-defunct community block clubs.

The man should have been elected mayor in 2005. He had the qualifications, the demeanor and the right attitude to lead the city.

He was one of the few in 2005 to stand up and call out Kwame on all of his shortcomings.

Don’t get me wrong, I have the utmost respect for Ken Cockrel and how he has handled the situation with Kwame. But he is not a strong enough or experienced enough figure to lead the city right now. His place should be on the city council as president, and quickly before Monica Conyers can screw things up.

Right now I’d say the other major candidate is David Bing, businessman and a NBA star for the Pistons from 1966-1975. The man is out for his own interests. He lives in the Western Suburbs but bought an apartment in Detroit last year with the idea to run for mayor against Kwame in 2009. He sees February’s special election as his chance to get in office.

UW on Detroit fully endorses Freman Hendrix in 09, and hopes he doesn’t lost in the muddled field of candidates.

On an even more personal note, I’ve actually had the pleasure of meeting Hendrix. It was at the state capitol in Lansing in the spring of 2006–I was there for a journalism conference and he spoke with me and a few friends about the effect the Super Bowl had on Detroit.

He was funny, intelligent and well-spoken–he practically demanded respect, something, I have to say, Kwame Kilpatrick never did in the handful of times I’ve seen him speak or seen him rolling into Starbucks with his entourage.

Remember, whoever is elected to office in February will have to run again in the November 2009 general election due to a mix-up with the city charter, so in theory, Detroit could have 4 different mayors (Kilpatrick, Cockrel, February winner and November winner) in a 16 month period.

Welcome to Detroit politics.

When first annouced earlier this year, it was hoped that the Cadillac Centre would provide a new center of culture in Downtown Detroit.

Detroit’s Downtown Development Authority approved a development agreement Wednesday with New York-based Northern Group Inc. to be ready within 18 months to build a $150 million entertainment, retail and apartment complex, called Cadillac Centre, on the Monroe Block near Campus Martius.

Campus Martuis is in a prime location downtown, and the plan was to build two all-glass towers over 20 stories tall with apartments and condos, and retail on the first floor.

But it doesn’t look like that will happen anymore.

Instead of a $150-million project with housing, entertainment, restaurants and more, New York-based Northern Group Inc. is now proposing to build a “dressed-up parking garage” for $40 million and nothing more, Jackson said.

Unless Northern Group agrees to build what it originally promised, the deal appears dead, Jackson said.

Two new downtown highrises like we are always seeing in New York and Chicago and even Madison? It sounded too good to be true.

I’m trying to find more background information on why this is happening–besides the obvious “it’s detroit” answer. Stay tuned…

A little background: The City of Detroit provides a gorgeous riverfront home to its mayor. After Kwame Kilpatrick was forced to resign last month due to a perjury scandal first unearthed by the Detroit Free Press in January, the home is now vacant, and Mayor Ken Cockrel says he has no plans to move in.

The Berry neighborhood, which stretches from the Detroit River to East Jefferson Avenue on Detroit’s east side — is filled with a diverse collection of some of the most powerful people in metro Detroit, including business owners, lawyers, judges, symphony musicians and city workers.

“This neighborhood is full of powerbrokers, people who are committed and interested in the city,” Campbell said.

Among them are Sharon McPhail, who has announced she is running for mayor, and the Rev. Nicholas Hood III, who has indicated he is considering running for mayor.

“We’ve got doctors, lawyers and Indian chiefs, and that sums it up,” said Linda Zaber, who has lived in the neighborhood for 22 years. “People don’t move in and out of this neighborhood. People are here until they retire and can’t maintain the house anymore.”

The Manoogian Mansion is vacant now. Detroit Mayor Ken Cockrel said he won’t move in. And there’s talk about turning the Manoogian into a museum or an orphanage. Campbell said she’s opposed to those ideas.

“This is a single-family residential neighborhood,” Campbell said. “My youngest daughter is adopted. I don’t have a problem with orphanages. That’s not the issue. But I didn’t sign up to live across the street from one.”

Kilpatrick has been accused of using the house for several house parties with strippers, large consumption of alcohol and illegal drug use. I understand the city’s desire to move away from the Manoogian–so how about this: sell it.

Even in this market, the property would fetch well over $2 million once the right buyer comes along. That money can be used to help remedy the $14 million mess left behind by the embattled ex-mayor soon to be getting three squares a day in an orange jumpsuit.

There is no reason for the city to use a multi-million dollar property in the middle of one of the city’s nicest residential neighborhood for something of civic value. Either keep it and keep a close eye on the next elected mayor, or get rid of it and make a few bucks along the way.

Welcome to UW on Detroit. This is the assignment of Detroit-native Kevin B. for an Urban Planning class at the University of Wisconsin.