Recovering Detroit Economy Still Challenges CEOs

Detroit has been experiencing an especially severe case of such whiplash lately as one CEO after another has made significant moves or pronouncements with a direct impact on the city and its future and also, often, major implications for his or her company.

They include Dan Gilbert, the founder of Quicken Loans who has emerged as the most reliable billionaire would-be savior of Detroit over the last several years. He continues to sink billions into the city—in real estate projects, charitable endeavors and even financing the construction of a downtown interstate spur—while also owning the NBA basketball team in another outpost of Flyover Country, Cleveland.

“More CEOs from outside Detroit are picking up on the promising economic vibe in the city, particularly as it pushes its way through unprecedented municipal bankruptcy proceedings and still manages to hold together.”

Another CEO notably devoted to Detroit is Mike Ilitch, founder of Little Caesar’s Pizza, who owns the Detroit Tigers and Red Wings, and much of the vibrant entertainment district in the north downtown area, and who is sticking his neck out yet again with a proposed new arena in that area for his Red Wings hockey team.

More CEOs from outside Detroit are picking up on the promising economic vibe in the city, particularly as it pushes its way through unprecedented municipal bankruptcy proceedings and still manages to hold together.

Whole Foods CEO John Mackey, for example, reaffirmed his company’s interest in the city by committing to build a second store in central Detroit just a year or so after the first Whole Foods Market opened successfully and continues to thrive in the city. And co-CEO Hendrik Meijer, head of the regional discounter chain based in Grand Rapids, plans to open the second Meijer store in Detroit.

The Motor City also picked up an important endorsement the other day from Warren Buffett, investor extraordinaire and Berkshire Hathaway chief, who said at a conference in Detroit that he’s bullish on the city and is looking for an investment there.

But then Detroit suffered a downer when Cadillac CEO Johan de Nysschen announced that General Motors is moving the brand’s headquarters—and its sales and marketing staff—to a location in the SoHo district in New York City because that’s where the biggest population of truly sophisticated luxury-brand consumers is. And that’s whom Cadillac is targeting instead of its traditional buyers.

“We are very proud of our Detroit roots and heritage, and the majority of the Cadillac workforce will remain in Michigan,” de Nysschen said. But it won’t be the same thing as having Cadillac headquarters.

 

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