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DETROIT -- The world's largest holding company of advertising agencies, which has done business with Ford Motor Co. for more than 75 years, plans to move several units to downtown Detroit in a move that could bring more than 1,000 jobs to the city.
London-based WPP plc — which includes GTB, VMLY&R, Burrows, Hudson Rouge, Iconmobile, Xaxis and Zubi — said Tuesday it plans to move into the vacant Marquette Building at 243 W. Congress St. The building is across the street from the site of the Detroit auto show -- the TCF Center, formerly known as Cobo Center.
GTB, or Global Team Blue, works heavily with Ford, which is renovating the Michigan Central Station in Corktown as an anchor to its $740 million autonomous and electric vehicle campus in the neighborhood west of downtown.
The new WPP space is expected to be open by the end of next year, the company said in a news release. It said it will also maintain a presence in nearby Dearborn, where the agency currently has about 850 employees.
The Michigan Strategic Fund board on Tuesday approved a $1.65 million Michigan Business Development Program grant for the move.
GTB CEO Robert Guay said in an interview that discussions over the move were well under way when he joined the company in July.
"As someone who has worked in a creative environment in the city of Detroit, I am thrilled with the opportunity to identify and recruit emerging tech and creative talent," he said.
An MSF board briefing memo says the move is a $19.24 million investment and that in addition to the 850 Dearborn employees, another 182 jobs are anticipated. The new building would house client engagement, finance, human resources, design, analytics and other company functions, the memo says.
The memo also says the city of Detroit has offered a personal property tax abatement up to 10 years with an estimated value of $993,000. The grant would not be disbursed until certain performance milestones are met, according to the memo.
The news comes a year after Ford replaced WPP as its longtime lead creative ad agency with BBDO of New York City. It switched shops following five months of review.
"Ford and GTB were on parallel paths looking for the same thing: Proximity to the city center and access to tech resources and talent," Guay said. "I can't say that we necessarily looked at the space solely because of Ford building in Corktown, but it certainly was an assuring thing."
The Marquette Building is owned by Detroit-based Sterling Group.
Auto seating supplier Adient plc, the spinoff of Milwaukee-based Johnson Controls Inc., paid $36.13 million to acquire and improve the property over the course of a year between November 2016 and November 2017, according to city property records. Then the company took a roughly $11 million haircut on it in a $25 million sale of the building, a 400-space parking deck and a surface parking lot a year ago.
A source familiar with the matter said WPP will lease most of the Detroit building and have its employees park in the parking deck and surface lot. Guay declined to comment on parking.
Adient was planning to turn the Marquette Building into its new $100 million headquarters, but that plan was scrapped in June 2018. Adient is remaining in its Plymouth Township headquarters.
After Ford Motor Co. and General Motors ended production of compact cars, many former car owners continued to purchase sedans instead of switching to crossovers and SUVs, according to an Edmunds analysis.
So far in 2019, 23 percent of former Chevy Cruze owners and 31 percent of former Ford Focus owners bought a car from a competitor, the online car sales website said in a report Wednesday.
"Ford and GM made a strategic decision to prioritize profit at the expense of market share," Jessica Caldwell, Edmunds' executive director of insights, said in a statement. "While this may set them up better in the long run so they have the cash they need to fund electrification and autonomy, there's no question that decision is giving their competitors an edge now."
Former Focus owners' brand loyalty declined over the last three years from 40 percent in 2016 to 33 percent through September 2019, the report said. Former Cruze owners' loyalty declined from 57 percent in 2016 to 45 percent in 2019.
The study showed 21 percent of Focus and 22 percent of Cruze trade-ins go toward the purchase of a compact car, many of those cars being Honda Civics or Toyota Corollas.
"The number of Focus and Cruze owners trading their vehicles in and buying a small Jeep [Compass or Renegade], Hyundai Kona or Elantra, Kia Forte or Subaru Crosstrek have all risen in the last three years," the study said.
In an emailed statement to Automotive News, GM spokesman Jim Cain said: “Chevrolet trucks and crossovers are offsetting lower car sales. The proof is in registrations, and registrations don’t lie. Dig deeper and you’ll see that key competitors -- Ford, Nissan, Toyota, Jeep and Chrysler, among others -- are losing significant chunks of retail market share. We’re doing fine.”
The study said 21 percent of Cruze owners and 18 percent of Focus owners traded in their cars for the corresponding brand's crossovers or SUVs in 2019. Edmunds analysts said the cost increase of a small crossover or SUV — between $4,000 and $8,000 more than a small car — puts pressure on younger and "price-sensitive" buyers.
"The catch is, if Ford and GM don't have affordable options for shoppers who are buying their first or second new car, it could be much harder to win them over later," Caldwell said in the statement. "Catching consumers early and keeping them in the family has been a basic tenet of automotive brand strategy for decades.
"It feels like we're in the midst of a transformative time for the industry where automakers are being forced to rethink everything," she said.
There's been a lot of interest recently in pickup truck beds and the 2017 Ridgeline has one of the most versatile in the industry. This video shows 60 rough cut landscaping stones, weighing about 14 to 16 pounds each, being dropped from a loader into the Ridgeline's standard composite bed. Is the Ridgeline bed tough? You be the judge.