Chicago-based Coyote Logistics opening Ann Arbor office with $1M state incentive
Chicago-based logistics and transportation provider Coyote Logistics will open an Ann Arbor office with more than 100 employees thanks to a $1 million incentive from the Michigan Economic Development Corporation.
Coyote's new 9,000-square-foot office will be in the 777 Building at the corner of Eisenhower Parkway and State Street. According to an MEDC memo, the company plans to hire 35 to 45 employees annually for a total of 125 new jobs in the next three years.
Coyote Logistics will open a new office sometime in the fall in the 777 Eisenhower Building.
Lon Horwedel | AnnArbor.com
According to a news release, Coyote also plans to invest $1.2 million into the new location that will support the company’s Chicago headquarters. Ann Arbor was chosen for the company’s offices over competing sites in Texas, California and Colorado. The company already operates satellite offices in six other U.S. cities including Atlanta, Memphis and San Diego.
There are no Ann Arbor jobs listed on the Coyote website yet, but current openings include positions in information technology, sales, operations and marketing. Vice president of communications Jodi Navta said the office will include a mix of jobs with a primary focus on creating relationships with customers in the shipping world.
“We are a third-party logistics company meaning that we are the ‘middle-man’ between shippers who need to move things and the carriers that take them,” she said.
“The shippers that we help coordinate movement of freight for include everyone from a mom-and-pop grocer up to a Fortune 500 company. And that’s the same on the carrier side, everything from an owner-operator to the big names you see on the highways.”
Navta said the company chose to open its new office in Ann Arbor because of close company ties to the area and the ease of attracting talented employees to work in the city.
“We recruit a lot of our employees from Big 10 schools and schools in Michigan,” she said.
“Our CEO went to the University of Michigan for undergrad and his MBA and having an Ann Arbor office is a great opportunity for us to recruit employees who want to stay in the area after school or move back to Ann Arbor to raise a family close to their hometowns.”
Ann Arbor SPARK worked with the MEDC and Coyote on the incentives process, and according to the news release, SPARK and the city of Ann Arbor will offer financial support to assist with the company’s recruitment efforts. It's not yet clear what the incentives will be.
“Coyote Logistics is the latest example of a company attracted to the Ann Arbor region because of the talent that’s here, and another CEO choosing to expand into the city they fell in love with while in college,” SPARK president and CEO Paul Krutko said.
According to Coyote’s website, it arranges transportation for more than 3,000 loads per day across North America.
The company’s new office will put employees in close proximity to global shipping services company Con-Way Inc., Ann Arbor’s only Fortune 500 company, which reported annual revenues of $5.58 billion in 2012.
The logistics community in Ann Arbor also includes supply chain software startup LLamasoft, which was named AnnArbor.com’s Deals of the Year technology winner in 2012 after expanding its downtown footprint and attracting Nike as a client and investor.
According to its program guidelines, Michigan Business Development Program grants are awarded to companies that are seeking to locate or expand and are deciding between Michigan and other sites in competing states. Barracuda Networks was awarded a similar incentive package in 2012 for up to $1.2 million when it announced the relocation of its Ann Arbor offices to the former Borders headquarters in downtown Ann Arbor.
Funds for the Michigan Business Development Program grant come from the Michigan Strategic Fund, which was created to promote economic development and job growth in Michigan. The MSF also houses the state’s 21st Century Jobs Fund and the Michigan Community Revitalization Program.
Ben Freed covers business for AnnArbor.com. You can sign up here to receive Business Review updates every week. Get in touch with Ben at 734-623-2528 or email him at benfreed@annarbor.com. Follow him on twitter @BFreedinA2
Comments
DJBudSonic
Sat, Aug 17, 2013 : 2:33 p.m.
Attracted to the Ann Arbor region by the free money we give, is what SPARK really is saying. Corporate welfare should be low on our list of spending priorities.
Nicholas Urfe
Sat, Aug 17, 2013 : 2:05 a.m.
Any word on whether the executives will be getting big fat bonuses for getting these tax credits? Credits paid for in large part by working class folks who are much, much poorer than them.
Nicholas Urfe
Sat, Aug 17, 2013 : 2:03 a.m.
Coyote must be well connected to be getting all this free money from the government. It is no coincidence the CEO went to Umich. Bet he would have opened this office regardless of the gifts of taxpayer dollars.
Veracity
Sat, Aug 17, 2013 : 12:53 a.m.
"Ann Arbor SPARK worked with the MEDC and Coyote on the incentives process, and according to the news release, SPARK and the city of Ann Arbor will offer financial support to assist with the company's recruitment efforts." How many Ann Arbor taxpayer dollars has SPARK and MEDC given to Coyote Logistics so far and how much more is promised? Is the money provided accompanied by any specific expectations other than "please create some jobs in Ann Arbor"?
Jim
Fri, Aug 16, 2013 : 3:40 p.m.
120 jobs x $40k average wage per year (probably low) = aprox. $5 million in wages per year, less taxes leaves around $4 million per year for these new employees to spend. That's money for housing, and businesses which in turn will hire people. In general, this deal will help grow this area's economy. Most of the money people make is local money we just are trading back and forth. Every time the money goes around the government takes it's share so there is less and less of it. Outside money is CRITICAL for supporting any economy. Well done Ann Arbor SPARK and the MEDC!
Nicholas Urfe
Sat, Aug 17, 2013 : 2:04 a.m.
Um, yeah. Corporate welfare paid for by tax increases on the workers. While the execs get rich.
Nicholas Urfe
Fri, Aug 16, 2013 : 2:56 p.m.
More corporate welfare for companies that do not need it. That corporate welfare is paid for by tax increases on the working people of Michigan and the poor. $8000 per job is a lot of corporate welfare. Thanks Snyder.
LXIX
Thu, Aug 15, 2013 : 9:13 p.m.
Corporate socialism. When the smart car/truck industry takes off from Ann Arbor (without any drivers) we can all thank our lucky comrade leadership for having such foresight and wisdom. Xie XIe (thanks) comrade Snyder. @Mr. Bean - the stock market is in its own 1% economy (meaningless value).. Just as Goldman Sachs owns the warehouses that control the flow of comodities (NYTimes). Which in turn allows manipulation of the US futures market (supply and demand). Which in turn predicts Wall Street will earn billions betting on those futures - and somehow they do - at the expense of other clueless investors and commodity consumers (us). It is a meaningful stock market. (dark sarcasm). If I controlled all the fuel in the US do you think I could affect the price of gasoline? According to NYTimes China and the other 3rd world miracles are now struggling and the old 1st world folk (Japan & Europe) are slowly emerging out of their recession - with a 1.2% growth last quarter. The Dow says we are in the best economy ever in U.S.History. Ha ha ha. Forget the markets. Just keep an eye open for those headless drivers running their logistics software.. And don't let them know where you work, either.
Z-man
Thu, Aug 15, 2013 : 5:57 p.m.
Obama also stuck it to the bondholders, who were legally supposed to be the first to get paid, in favor of the unions. So much for the rule of law under this president!
Z-man
Thu, Aug 15, 2013 : 6 p.m.
Sorry, this post was supposed to appear as a response to JBK's response to Stupid Hick's post just above.
JBK
Thu, Aug 15, 2013 : 4:27 p.m.
Huh? "We recruit a lot of our employees from Big 10 schools and schools in Michigan," she said. I highly doubt some man/woman out of a Big 10 school would take a job in Logistics. Isn't that typically HS or GED?
Barb
Thu, Aug 15, 2013 : 7:49 p.m.
Google "degrees in logistics" and you might be surprised. You may not understand all that's involved with getting materials from Point A to Point B but it's not just truck drivers.
Sparty
Thu, Aug 15, 2013 : 6:05 p.m.
Why don't you ask Coyote or XPO Logistics ... or any of the Logistics Firms located here in Ann Arbor ? I'm sure they'd be happy to talk to you now that you've slammed their profession and employee base. Logistics is a degree program, you know?
Stupid Hick
Thu, Aug 15, 2013 : 3:09 p.m.
It should be illegal for government entities to pick winners and losers by bribing businesses.
Sparty
Thu, Aug 15, 2013 : 6:03 p.m.
I thought only Obama and the Democrats picked "winners and losers". Now I'm so Confused to learn that Michigan Republicans having been doing it all along as well and so successfully we see as the unemployment rate has gone up again (sarcasm), in fact Michigan seems to have only benefitted from unemployment reductions related to the auto industry growth. Hmmm - Obama saved that. Well.
Z-man
Thu, Aug 15, 2013 : 5:58 p.m.
Obama also stuck it to the bondholders, who were legally supposed to be the first to get paid, in favor of the unions. So much for the rule of law under this president!
JBK
Thu, Aug 15, 2013 : 4:28 p.m.
Kind of like what Obama did with the Auto companies and the bailout? Unions got everything and the Salaried got thrown under the bus.............................?
lumberg48108
Thu, Aug 15, 2013 : 2:59 p.m.
Not on board for this corporate payout at all, especially since the mantra of the MEDC has been economic gardening (grow from within) instead of incentives (hunt and gather.) By all accounts this company is healthy and relocating to A2 is good for them; so why the corporate welfare? We cannot continue to underfund K-12 and higher ed while giving strangers money in hopes that make good on promises to hire. Here is more about economic gardening and most think it works better than hunting and incentives... especially the MEDC and yet here we are. http://www.michigan.gov/documents/uia/M_-_Economic_Gardening_387849_7.pdf
clownfish
Thu, Aug 15, 2013 : 2:31 p.m.
Coyote logistics revenue: 2008 Revenue:$134.2 million 2011 Revenue:$558.7 million 316% growth. Why do they need taxpayer support? Corporate welfare at it's worst.
pest
Thu, Aug 15, 2013 : 5:06 p.m.
Revenue doesn't equal profit. A small mom & pop grocery store can generate a half mill or more in "revenue" with moderate sales and barely break even. Heck, a 16 year old babysitter can generate $1,820 in annual revenue by babysitting 5 hours a week at an average of $7 per hour
CynicA2
Thu, Aug 15, 2013 : 3:59 p.m.
Depends on what kind of profits that revenue generates - they probably wouldn't be here without the incentives.
Sparty
Thu, Aug 15, 2013 : 1:15 p.m.
Unemployment increased again in Michigan to 8.8% this month, while nationally it decreased to 7.4%. Where's all the Jobs, Governor? Or do we need to give businesses more of a tax break at the expense of yet again increasing individual rates and pension rates?
Sparty
Thu, Aug 15, 2013 : 5:59 p.m.
Ah ....Chris. Does that apply nationally as well ?
Chris
Thu, Aug 15, 2013 : 5 p.m.
The growth in the unemployment rate is driven by more people re entering the workforce, not fewer jobs.
Steve Bean
Thu, Aug 15, 2013 : 12:40 p.m.
The Baltic Dry Index peaked in 2008 and has dropped considerably since to a 25-year low, bumping along sideways at less than 20% of the high for the past year and a half. The BDI is considered a leading economic indicator (not to mention directly relevant to this company's business). The stock market appears to have topped at the beginning of August and should decline rapidly and deeply over the next several years per Elliott wave theory. Economic impacts generally follow the market trend by six months. If this company does add employees, it's not likely to be for long. Ben, do you know if there's a minimum employment period for each new hire in order for them to get the incentive payment from the state?
snark12
Thu, Aug 15, 2013 : 7:05 p.m.
EWT has been predicting this drop for over two years. I'm sure it's good for business.
Steve Bean
Thu, Aug 15, 2013 : 1:41 p.m.
The market drop this morning appears to be a third wave of a third wave (hence the down gap/steepness), and takes the Dow and S&P indexes below the low of the 4th wave that preceded the top, thus giving strong confirmation that it was the top. If this scenario holds up, subsequent highs will be ever lower as will subsequent lows until the bottom, probably around mid 2016. The steepest drop ("crash") will likely occur about halfway between now and then.
Steve Bean
Thu, Aug 15, 2013 : 1:10 p.m.
Thanks, Ben. Could you look into it? Not having at least a six-month minimum would be wasteful of public funds.
Steve Bean
Thu, Aug 15, 2013 : 1:07 p.m.
Yup, I was wrong. The wave pattern developed differently than it appeared to be at the time. The point with regard to the stock market is that whether it had topped earlier this year or this month, the ensuing decline is anticipated to be the largest in history. If you choose to focus on the less-significant, short-term details, that's up to you. (And if you're in the market, that increase is only realized if you sold at the top.)
Ben Freed
Thu, Aug 15, 2013 : 1:05 p.m.
There is not a minimum employment period in the memo I was sent, but the assumption by the state appears to be that the new hires will occur within the next three years.
clownfish
Thu, Aug 15, 2013 : 12:59 p.m.
You told us this back in February, I think. Since then the DOW has gone from 13,300 to 15,400. Dropping like a stone!
Steve Bean
Thu, Aug 15, 2013 : 12:43 p.m.
… by six months or less…
clownfish
Thu, Aug 15, 2013 : 12:26 p.m.
Coyote Logistics is doing great, making money hand over fist. Why do they need help from Michigan taxpayers to expand their business?
Meggie53
Thu, Aug 15, 2013 : 3:12 p.m.
Because that is how the game is played. You have to spend money to make money for your state.
Pizzicato
Thu, Aug 15, 2013 : noon
I'm suspicious of the grant made to this particular type of work. The business of freight logistics is characterized extremely high employee turnover - for most employees, it's a "sell or else" approach to employment. A shockingly small percentage of individuals end up succeeding in this type of environment. The company might well create 100 jobs, but I'm not at all confident that those jobs will turn into long-term careers for many.
Barb
Thu, Aug 15, 2013 : 7:47 p.m.
Really? That's unique to logistics? In my experience "sell or else" is the mantra for most Sales-based positions in many businesses.
thinker
Thu, Aug 15, 2013 : 11:51 a.m.
Where are the critics of Governor Snyder and his programs now?
johnnya2
Thu, Aug 15, 2013 : 8:01 p.m.
So I should applaud ANOTHER round of corporate welfare for Rick Snyder and his spending TAX PAYER dollars to have a company move to Ann Arbor? Really? If you have to pay a company to be in Michigan., it probably doesn't need to be here. if the lie that " a company attracted to the Ann Arbor region because of the talent that's here" is true, then why would they need $1 MILLION?
CynicA2
Thu, Aug 15, 2013 : 3:55 p.m.
The various costs of doing business are still high in Michigan relative to many other states, and while the merits of our public schools may be debatable, it is not because we spent too little money on them. Michigan is a shrinking state, with fewer taxpayers and fewer school age kids than 20 or 30 years ago, so it doesn't need to spend so much on schools, and really can't afford to in any case. That being said, the various financial incentives to business don't always seem to be a wise investment either, as others have noted.
Tom Whitaker
Thu, Aug 15, 2013 : 1:39 p.m.
Right here. I just finished reading two articles about teacher layoffs and redistricting due to severe shortages in school funding, only to come to this article about giving away a million dollars to a large corporation. I don't care who hands them out, Democrats or Republicans, incentives to lure businesses are a bad idea and studies show they rarely provide the promised benefits. Those in the government economic development industry, when they share numbers at all, invariably twist and inflate them. Pfizer and Google are two prime examples of the failure of these incentives. Businesses are more attracted to locations with quality schools and universities, along with livable cities for their employees (roads in good condition, a variety of housing stock, parks, public transportation, efficient services, and attractive downtown entertainment and restaurant districts). Look at help wanted ads for educated workers on the web--medical, tech, scientific, etc.--and you'll often see them promoting the town the company is located in, and all the amenities mentioned above. Many times they reference historic districts and parks to lure candidates. Provide these physical features, amenities and services, which are largely traditional government functions, and you will attract businesses and employees to those businesses. There's no need to pay them to come--especially to places like Ann Arbor. I can see why some would see the need to pay them to come to depressed areas like Detroit, but not Ann Arbor, which probably has the lowest unemployment rate in SE Michigan.
fjord
Thu, Aug 15, 2013 : 1:37 p.m.
Do you seriously think this one company opening an office here validates Snyder's programs?
Sparty
Thu, Aug 15, 2013 : 1:20 p.m.
Standing in line wondering why unemployment is increasing under his watch, despite his big business tax cut and corresponding increase to individual tax rates and pensions.