Technology/R&D

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MI: KLA-Tencor to Establish Ann Arbor R&D Facility, Invest $70M, Hire 500

24 Oct, 2018


Citing Michigan’s attractive business climate, logistical assets, and R&D talent base, Silicon Valley-based KLA-Tencor Corporation (NASDAQ: KLAC) announced its plans to establish a new research-and-development center in Ann Arbor. The development is expected to generate a total capital investment of more than $70 million and create 500 high-tech jobs over the next five years.

That project, along with a $3.6 million expansion by Coyote Logistics that will create 300 jobs in the city of Detroit, was approved by the Michigan Strategic Fund, the Michigan Economic Development Corporation announced. The new investments draw on the state’s R&D climate and timely supply of high-skilled engineering talent and logistical resources.

“KLA-Tencor’s decision to invest and grow here offers further evidence that Michigan is becoming one of the preeminent locations for high-tech companies to grow or relocate their business,” said Gov. Rick Snyder. “This expansion underscores the attractiveness of our business environment as well as the strength of our logistical assets, our talented workforce and our high quality of life. The company’s high-profile investment further establishes Michigan as a place where high-tech talent demands can be met, and tech companies can grow.”

KLA-Tencor Corporation is a leading provider of process control and yield management solutions for the semiconductor and related nanoelectronics industries. Headquartered in Milpitas, California, the company has approximately 6,800 employees worldwide, but does not currently have any in Michigan. The company announced plans to establish a research-and-development center in the Ann Arbor area, selected among 350 potential sites in North America. The project is expected to generate a total private investment of more than $70 million.

“KLA-Tencor is committed to innovation and a high level of R&D talent is a necessary element to develop the complex solutions that our customers need,” said Chief Strategic Officer Bobby Bell.

“Among the decisive reasons for building a major R&D hub in Michigan are Ann Arbor and the Detroit metropolitan area’s attractive talent pool, relative low-cost of living (compared to the San Francisco region where KLA-Tencor is headquartered), proximity to Detroit Metropolitan Airport and other logistical advantages that support KLA-Tencor’s leading international semiconductor and electronics customers,” Bell said. “These advantages enable innovation across a broad spectrum of semiconductor consumption and electronics, including data storage, cloud computing, machine learning and automotive.”

“Ann Arbor also stood out by giving us the opportunity to strengthen our partnership with the University of Michigan and its proximity to the automotive industry,” he said. “Locating in Ann Arbor and the surrounding area allows the company to draw from one of the greatest concentrations of engineering talent in the U.S.”

As a condition of MSF support, KLA-Tencor will hire 500 employees over the next five years. Many of the new jobs will be highly skilled, high-paying positions requiring top talent. The investment qualifies for Good Jobs for Michigan withholding tax capture for up to eight years, and a $1.5-million Michigan Business Development Program Performance-based grant.

“Semiconductor demand from the automotive industry is experiencing rapid growth, along with a corresponding need for improved device reliability and defect control,” Bell said. “Customers in the automotive industry and the leading semiconductor manufacturers are turning to KLA-Tencor and our advanced process control solutions and services to help address these complex challenges.”

KLA-Tencor’s R&D semiconductor research center will be a major boost to the semiconductor industry in Michigan. Automotive companies purchase $21.8 million of semiconductors from Michigan-based companies. It’s expected that demand for semiconductors will increase rapidly with the development of mobility and autonomous vehicles.

“KLA’s investment is a catalyst for attracting other high-tech companies and underscores the state’s growing automotive and technology R&D assets,” said Jeff Mason, CEO of MEDC, the state’s chief marketing and business attraction arm that administers programs and performs due diligence on behalf of the MSF.

“Governor Snyder’s collaboration with KLA-Tencor executives demonstrates his commitment to helping high-tech companies establish a presence in Michigan and delivers the message that there is no better place in North America for growing companies to expand and succeed,” Mason said.

The project brings the total of jobs created under the Good Jobs for Michigan program to nearly 1,000, including an announcement by pharmaceutical leader Pfizer in July 2018 that it was establishing a new, $465-million manufacturing facility in Portage, a project that will create 450 highly-skilled, high-paying jobs. Gov. Snyder signed the Good Jobs for Michigan job-creation package into law in July 2017. 

Individuals interested in careers with KLA-Tencor should visit https://careers.kla-tencor.com/.       

Also at the MSF meeting, the board approved a $1.5-million Michigan Business Development Performance-based grant to support Coyote Logistics’ $3.6-million investment in Detroit’s Corktown neighborhood, near the Ambassador Bridge and Ford Motor Company’s newly acquired train station.

As the leading third-party logistics provider in North America, Coyote maintains more than 14,000 shippers servicing a range of industries. In 2015, Coyote was acquired by UPS, yet maintains a separate identity in 12 states. They established operations in Michigan in 2013.

The expansion in Detroit includes the addition of 300 jobs, and marks Coyotes continued growth in Michigan. The state was selected over a site in Denver because of proximity to recruiting recent college graduates, and cost of living advantages.

“Coyote is a growing organization that sees great promise in Detroit for its location, talent in Michigan schools and support for economic resurgence from public and private organizations.  We are excited to expand Coyote’s presence in the Corktown neighborhood of Detroit and look forward to recruiting Michiganders to join the Coyote team,” said Coyote Chief Financial Officer Craig Gaubert.

The city of Detroit anticipates approval of a personal property tax abatement in support of the project. For information on careers with Coyote, visit https://coyote.wd5.myworkdayjobs.com/en-US/coyotecareers.

“Today’s projects demonstrate that our efforts to expand and diversify Michigan’s business environment continue to gain momentum and bring results,” Mason said. “Companies continue to realize the invaluable assets that Michigan has to offer; high-tech engineering resources, top-notch research and design and a highly skilled workforce. Matched with low cost of living, Michigan has the ingredients that companies seek out when looking to relocation or expand their business.”

MSF also approved the following:

·        An authorizing resolution for issuance of private activity bonds Oakland Corridor Partners, LLC to make improvements to a 5.5-mile segment of the I-75 corridor.

·        An award of $9.6 million from the Investment Fund to be contributed as an equity investment into Grow Michigan II. The purpose of this investment is to leverage private sector investment with a fund size of $59.6 million.

·        An additional $3 million in funding for the Invest Michigan Pre-Seed II Fund to allow investments in new technology startup companies to continue for another year.

·        An extension of one year and additional funding totaling $2.485 million for two University Technology Acceleration and Commercialization programs: the Technology Transfer Talent Network and Michigan Corporate Relations Network.

·        Changes to the Michigan Translational Research and Commercialization (MTRAC) program guidelines to add an Advanced Manufacturing hub and combine the Bio Medical and Life Sciences hubs.

About Michigan Economic Development Corporation (MEDC)

The Michigan Economic Development Corporation is the state’s marketing arm and lead advocate for business development, job awareness and community development with the focus on growing Michigan’s economy. For more information on the MEDC and our initiatives, visit www.MichiganBusiness.org. For Pure Michigan® tourism information, your trip begins at www.michigan.org. Join the conversation on: Facebook, Instagram, LinkedIn and Twitter.

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