Michigan Matters: Roger Penske and Mark Reuss on the issues

I literally have known Roger my whole life, which that's a privilege number one. And number two, I can remember those days my dad taking me to the Indy 500 and I met you for the first time actually. So in '86 I was graduated from college but even before then, before we had those, we had the stock blocks for Buick and Chevrolet, remember those? And boy, you know, going to the Indy 500, I just really wanted to be an engineer. I really wanted to be like Roger, you know, and be like the company because the execution was always so high. And frankly I was in awe every time my dad took me to one of those races and his wife Kathy sort of always took care of me because there was a lot of business going on so I was sort of hanging around and I looked older than I was so I could sneak into the pits, you know, but she always took care of me. So a lot of fond memories there but also a lot of winning memories and you know later as we became business partners over a long period of time, Roger and I post-financial crisis sat down and said, you know, I'd really like to have a Chevrolet engine back in IndyCar and Ilmor is still there, the original partnership that goes back to that '86 time frame, right? And you know, what could we do to do that? And so we sat down with Bud and the whole Penske team and took a look at can we get another Detroit race here? And I said, I'd love to be able to say that we have another co-developed engine and another race in Detroit. And we both really had that drive with IndyCar at the time before Penske's ownership of it to drive that home and get a race back. And I have a lot of memories of that. Those, the first race, Bud Denker was pouring like a dry mix onto the concrete on Belle Isle. Remember that? To make sure because some of the rubber was coming up on the tracks. So that's the kind of commitment though that the Penske Corporation has. And you know, I wasn't around in '67 with Mark Donohue and the whole Trans Am piece, but I sure have a lot of memories of the cars, the drivers, and the company has always been, you know, a standard of excellence.

I've got to say the administration doesn't come from the auto industry. But as this was being rolled out and put in place, it's been a really open door for some of the puts and takes on what happens because you know we make engines in Flint, a lot of engines in Flint that go into trucks that are made in Mexico that come into Mexico, and that's just one example of that. So the supply chains are very complex. They're global. And so you have to get into that detail to be able to know that and bringing production back to the United States is something that everybody would love to see because it's jobs and it's growth and it's all of that. So we're doing that. And so I would say it's been a really open conversation and constructive pretty much from day one. And you know, we've worked with I don't know how many administrations over what period of time, but we work with every administration. And so, you know, this isn't one administration versus that's not what's going on. It's how can we do this? How can we get, you know, real support and real fundamental growth in the industrial manufacturing base of the auto industry here? And so that's been the conversation.

Oh my gosh, it was billions of dollars worldwide as well. Trying to get, you know, internal combustion engine powertrain regulatory consistency and so it's a big deal.

Well, if you go back in history and you look at GM really brought aesthetic design to the industry. People sometimes don't know that but we did. And so the Harley Earl piece of that and then the Saarinen influence of the mid-century modern is something that's very important to us because we still believe that design drives the passionate buying experience, putting the customer at the center of all that and that was based on a lot of research and a lot of history that came about. In fact, there's a, I think there's the '38 ACD coupe sitting out here, but also, you know, sort of the Cadillac Celestiq is sort of our current design thinking for Cadillac that's in this building. So, it goes right down to the sections of the wood walls are similar to the tech center and design and other places there. All those things are really carefully curated. Even the floor that you're sitting on here is really brought from that mid-century modern that we have in a lot of our different facilities. And the Berto, of course, that's hanging, there's a lot of rich heritage to the Berto wall that is a Cadillac house in the center of the tech center and then in Flint. And so a lot of really cool stories I could go on and on. I know you said we don't have a lot of time on that but just take a moment and take a look at some of those things. We redid the goddess, the goddess that's sitting out there that hasn't been seen in a long, long time. So, our sculptors in Warren did that. So, great stuff.

Well, you know, we put a billion dollars in that riverfront. So, you know, big commitments and we sort of redid the inside of that ring. It's a very difficult building to visit and work in. I worked in there for a while. But it's a bit confusing. So, we did that. We put the money in it and we don't want to see all that go away necessarily and I think Dan Gilbert and his team did a nice job of putting renderings together that show the possibilities of office, of residential, of commercial all coexisting there and creating and reimagining the whole waterfront. So, you know, it's not derelict. We don't want to see any of that. We want to see that part of the skyline still and I think we can do that.

You know, we're open to anything, but you know, we put $250 million commitment-wise into that to make sure that the right things happen there, and we're hopeful.

No, but this morning was very competitive, but it was not on the Lodge.

Everything happens really fast. And I mean, really fast. And so, it's hard to describe. You're pulling some serious G's. It's done on a long oval. And so, they average the speeds going north and south on it. And the thing I was not prepared, Ken Morris and I were doing this, and the G-force, and so the G-force going into that at over 200 miles an hour and coming out of it is something you don't see on a simulator and frankly I don't know how you teach that but it was thrilling.

Yeah. I didn't close my... No, I didn't. Forcing the blood, trying to force the blood out of my head. But speaking of motorsports, a couple of things here. You know, we're deeply, deeply committed to motorsports and we have been, you know, along the way. So, we race in the GTP, you know, IMSA and WEC. We race Corvettes, you know, globally. It's a big deal. And then IndyCar, of course. 134 wins across all of our national series last year, 11 driver championships, five manufacturers championships, and three championships. Thanks to people like what's going on right here. So, yeah, we are deeply committed.

Yeah, there'll be something happening there, but I can tell you, you know, Bud and Roger and the whole team have done a wonderful job bringing it off of Belle Isle to the streets with what we have. And I think there's a lot of variation that can happen there and a lot of creativity and flexibility. So, I think that partnership is key. Like you say, the partnerships are everything because we'll work together with how that becomes a new riverfront to bring a great track.

We take students out of the Detroit public schools, educate them on things like checkbooks, bank accounts. I wish I would have had that back then. All those things. So, we get a good front view of that and the opportunities to show kids what could be are still in front of us. And so while it's a lot better, the test scores aren't good. And so we have got to keep working on that. And it is an ecosystem problem. It is not because there's no money or there's not great teachers. That's not true. There are... I think that's what's really encouraging about what Mary Sheffield is doing. That concentration on the neighborhoods and the ecosystem is really key to break that cycle.

It's very important. You know we have multiple facilities there. Always have had, have a tech hub there around the Markham area. So you know if you think about it, we've always said that we want to go to where people want to be for some of the places that bring different things to our company whether it's technical ability or manufacturing. The manufacturing sites we have in Canada are some of our very best in terms of commitment, quality, and production. So it's very important to us. Oshawa in particular, our headquarters in Canada is very important. It's been a long-standing thing and I think you know our Mexico operations the same way. We have been there for a long, long time probably my whole career and so that's a great place for us from our market share and sell. We make a lot of things and sell in Mexico but we also have a global footprint of other markets that come out of Mexico. So very important to us.

I don't know if I should, but I'm going to tell you that the partnership we've had with Mayor Duggan and now Mary Sheffield is extraordinary. You know, we put $2.2 billion into bringing Hamtramck back online, which has been a great thing for the city. But I'd also say that there's a lot of other things that we've worked on that may have not gotten all the media headlines that were, you know, we put $150 million into the community here over the last 10 years. We're going to keep doing that. You know, there's just billions of dollars in the state of Michigan, $17 billion that we put investment-wise back into the state. And those are big investments and they aren't for, like Roger said, they're not for the next year. They're for the next five to 10 years. And it's because people like Mayor Duggan and now Mary Sheffield who's going to concentrate from I've watched and I've watched a lot of what she said is on the neighborhoods, safety, children, all the things, you know, they're important. And so, taking the momentum from city council into that is going to be a big deal. So, I'm very optimistic and very positive on that. And I think we're lucky. Just in Michigan, you know, 38 facilities, 210 dealers, a thousand tier one supplier locations, and a lot of money. So, on a United States level, you know, we're about $134 billion from an economic additive piece of that. That's a lot. We employ the most people in the United States of any OEM. And we make and sell, we sell the most vehicles of any OEM. So it's a big contribution. State of Michigan just by itself 4%, $29 billion of contribution here. So these aren't trillions, but you know we feel like we're doing our part for the communities and our plant cities and especially Michigan, but there's much more to do and we'll continue on that path.