MTV's first Twitter Jockey Gabi Gregg loves social media

With the TV industry struggling to retain audiences, networks and award shows specifically are incorporating social media technology into their broadcasts, in an attempt to boost ratings by creating a more interactive program. This weekend, social media analysts will be watching carefully to see how well this year’s MTV Video Music Awards will continue the trend. “[Award shows are] absolutely capitalizing off of social media,” says Stephanie Humphrey, Technology Correspondent for YourBlackWorld.com. “You’re getting more eyes on your programming if [a Twitter user] uses #ChrisBrown and their friends see it and retweet it, or remember to themselves, ‘Oh, the BET Awards are on tonight; let me go turn on the TV!’ It keeps people connected. People aren’t always at their couch. I can be at the library or work and check in and see who just won ‘Best Artist’ through Twitter.”

“The BET Awards this year was the most impressive with its social network tie-ins,” Humphrey continues. “Ford hosted the social media lounge at the show, and there was a contest for Twitter users who used the given hash tag—the winner won a new Ford Focus!”

BET and Ford both garnered publicity and viewers, not to mention amassed more Twitter followers for subsequent marketing schemes. A winning situation for all involved. So it should come as no surprise that award shows, corporations, and networks alike are integrating social media to the extent that they are. This past year, MTV even went as far as to hire Gabi Gregg as its first “TJ” (Twitter Jockey) to capitalize on the medium’s reach.

“TV is in the business of attention,” says James Andrews, a digital communications/content strategist, who directed the social media strategy for the Grammy Awards. With Andrews’ help, the show garnered their best ratings in over a decade—over the course of three hours, a staggering 90% of Twitter conversations mentioned the Grammy Awards. “TV is about how many eyeballs you can steal; how much attention can you provide and produce to take those eyeballs away from somewhere else and have them focus on whatever it is you’re doing,” he says. “MTV does it well; BET has been integrating more recently, but The Grammy’s ability to think of communication as a story arch is really what sets them apart.”

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MTV embraces social media with the launch of "TJ" position

For this past year’s Grammy Awards, one unique approach used was the creation of a community blogger forum. For each musical genre there was a blogger on the floor giving a virtual play-by-play so that fans for each respective group (hip-hop, jazz, classical, pop, etc.) could experience the show through the unique perspective of that particular music culture. It created a niche that filtered through all of the information that’s important to the specific portion of the audience. “They understand that a tweet can start off small then snowball in to a massive trending topic,” says Andrews, “And they’ve built a way to support that arch and move with it.”

While Andrews can’t provide specific trade-secret details of how the Grammy Awards so successfully utilized the ‘story-arch’ strategy, he did have one useful hint: “Social media is a culture,” he affirms. “It’s not just about individuals. And you can feel the difference of when an organization is embedded in the culture of social media versus when they’re just trying to capitalize without really knowing what they’re dealing with. In the future, I can see new careers in social media for people to act as intermediaries between the viewer and the show—maybe when a viewer sees someone on an awards show or a TV show with a pair of shoes they like, they can tweet to the intermediary and get an immediate response about what brand of shoes they’re wearing. It would be like customer service for television. I think Twitter works well today, but it’s important to note that it’s the behavior that creates a movement, not the tool.”

That’s not to say that there are no potential concerns to be raised from this new marketing tool and the behavior it supports. Several industry insiders have raised questions about the ethical implications of “sponsored tweets”, which is when a company pays to have a celebrity casually mention their product on Twitter. Reality star Kim Kardashian allegedly rakes in $10k per tweet from some sponsors.

This practice raises concerns about the genuineness of the medium as users may soon be unclear about which tweets are true and which are just for a quick buck or other corporately driven motives. “We live in a capitalistic society,” Humphrey cautions. “The money is fast and free, but you have to be honest in your marketing… There are a couple of Websites that, depending on your Internet profile and visibility, even if you aren’t a celebrity you can still name your price for tweeting about a product. It’s buyer beware.”

Ford's new monster truck (Image: JeffCars.com)

2011 F-250 4×4 CREW CAB LARIAT KING RANCH DIESEL

• MSRP: $64,145 (Base F-250 starts out at $48,860)
• Engine/Horsepower: 6.7-liter, 8-cylinder diesel/400
• Fuel Mileage: No government fuel rating is available for heavy duty (super duty) trucks
• Standard Towing Capacity: 14,000 lbs
• Highlights: Locking removable tailgate with lift assist; tie-down hooks; dual-zone electric temperature control; Ford’s Sync System; Sirius Satellite Radio; manual locking hubs; trailer towing package and 20-inch wheels
• Competition: Chevy Silverado Heavy Duty Crew Cab, Dodge Ram 2500 Crew Cab and GMC Sierra Heavy Duty Crew Cab

WHAT’S NEW:

Underneath the two-tone exterior of the redesigned power dome hood, the F-250 Lariat King Ranch edition now carries an all-new booming diesel engine, offering more torque, improved fuel-economy and 40 additional horsepower. Added to that, the Super Duty truck is also outfitted with a new six-speed transmission, which enhances the fuel economy. Also, the new Super Duty diesel engine is compatible with B20 fuel, allowing up to 20 percent biodiesel and 80 percent petroleum diesel.

This five-seater luxury workhorse has the highest-rated towing capacity in its class and has been a part of a series of the U.S.’s best-selling full-size trucks for 33 years. For the 2011 model year, every F-250 is now decorated with an easy-to-read LCD (liquid crystal display) productivity screen, which provides such driver-oriented information as fuel-economy, off-road performance and towing guidance.

Other new features include heated (and cooled) front seats along with a larger front seat center console, which includes a lockable storage. And for those looking for extra towing power, a factory-installed fifth-wheel and gooseneck are now available. One no longer has to use an aftermarket company to accessorize their truck.

The beauty inside the diesel beast (Image: JeffCars.com)

PROS:

By equipping this truck with the F-250’s top of the line trim, the King Ranch Package transforms a run-of–the-mill pickup to a true luxury workhorse. It’s like having all of the accoutrements typically reserved for a premium priced vehicle, but, in this case, it’s a truck.

Besides all of the aforementioned features I noted with the new diesel engine, the King Ranch’s interior is unlike any truck I’ve ever tested. Inside the roomy cabin, one can find everything from 10-way power front dual and two-tone Chaparral leather seats to a memory driver’s seat and memory adjustable gas pedals to a remote start system and a premium-class eight-speaker sound system.

Also, to help navigate this gigantic workingman’s (or lady’s) truck, I found that the F-250 I tested was not only equipped with a back-up camera, but an audible reverse vehicle sensor, too. Just like airbags, these much needed safety features should be mandatory for every full-size and super duty truck. Furthermore, my truck featured Ford’s optional power moonroof and a voice-activated navigation system.

With this being a 4×4, Ford has left no stone unturned as it relates to carrying cargo, offering an optional stowable bed extender, a tailgate step (or man steps) and a sprayed-in tough guard bed liner. All of this and more were attached to my 8-foot bed. (A 6-foot bed is also available in this truck, helping to lower the price.) What else could one ask for?

More towing power than ever (Image: JeffCars.com)

Moreover, the 2011 Super Duty also increases its tow ability by offering an optional factory-installed fifth-wheel and gooseneck, providing additional towing power. Without the fifth-wheel, the truck is capable of towing up to 14,000 lbs, but adding the fifth-wheel increases the F-250 towing power by 1,700 to 15,700 lbs in the 4×4 (and up to 16,000 lbs in the 4×2).

Lastly, to help maintain control of this Super Duty when towing, a trailer sway control (TSC) helps to monitor the truck’s motion when a trailer is attached. In addition, Ford also offers a factory-installed integrated trailer brake controller, which aids the driver in offering a safer and smoother operation stopping when towing cargo. Again, Ford has thought of everything for this luxury workhorse.

CONS:

This super duty truck was accessorized with almost everything except Ford’s Blind Spot Lane-Changing System, which alerts the driver of objects in the blind spot before changing lanes. And I was somewhat disappointed that my test F-250 wasn’t equipped with a larger fuel tank, allowing for me to achieve more than 350 miles on one tank of gas.

FINAL VERDICT:

No, you won’t need a special Class A license to drive this truck, but within a matter of seconds one will easily find out that this vehicle is just as a tough as an 18-wheeler. Not only is this truck capable of pulling almost everything in sight, it does so in class and style with its bigger, bolder grille, which hides the booming sound of the diesel engine.

In fact, this miniature big rig is so interchangeable that it can be used for fieldwork during the week, towing a small yacht on the weekend or cruising across the country while towing a camper during vacation season. This everyday workingman’s (or woman’s) luxury truck is available with a diesel (or gasoline) engine in either a 4×4 (or 4×2) configuration. Yes, it’s no wonder why Ford is America’s best-selling truck in America.

Jeff Fortson is an auto analyst and editor of a car-buying website for women and minorities. To learn more about his popular car-buying workshop and/or to price a new-vehicle, drive on over to JeffCars.com.

In order to meet the President’s lofty goal, we have to ask the following questions: Where are the recharging stations to reboot the electric vehicles? And what’s going to encourage Americans to buy an electric vehicle, when we haven’t even warmed up to hybrids yet?

Green Machine: the 2011 Kia Optima Hybrid (Image: Press)

According to hybridcars.com, hybrid sales dipped over the past three years, as the overall new-vehicle market rebounded in 2010. Added to that, the government literally pulled the plug on subsidizing hybrids (and diesels) at the end of last year—shifting funds to electric cars and plug-in hybrids for 2011. (Currently, the Chevy Volt and Nissan Leaf are the only two semi-affordable mass produced vehicles in production qualifying for this incentive).

While the media has led us to believe that everyone is driving green, the reality is that hybrids only represented approximately 2.5 percent of the overall market in 2010, equating to only 28,592 vehicles. These dismal numbers are a far cry from what the President is asking of America (and the automakers) as it pertains to this big push toward electric vehicles.

Furthermore, minorities really haven’t jumped on the green bandwagon. The latest study conducted by J.D. Power, a marketing research firm measuring consumer behavior, revealed that minorities (African Americans, Hispanics and Asians) purchased 14.1 percent of the hybrids sold in 2008, as opposed to 20.4 percent of gas-powered vehicles. Based on these numbers, one can only assume African Americans are underrepresented in the hybrid market, since this group represented only 6 percent of all-new vehicles sold last year, according to a recent report commissioned by Toyota Motor Sales USA.

Lexus goes hybrid with the 2011 CT200 (Image: Press)

Ford Motor Company recently found this to be the case, as they sought the assistance of a research firm to conduct focus groups in three metropolitan cities with African American hybrid (and luxury) owners in the age set of 30 to 49, who had purchased their vehicle new. While it was relatively easy for Ford’s research firm to find luxury car owners, they hit a wall when searching for African American hybrid owners.

In order to get the country moving toward driving green, it’s going to be incumbent upon our government, along with the automakers, to work hand-in-hand to make this happen. Minorities, more specifically African Americans, need to be looped in the marketing plan, helping Americans go green. As the fast food chain McDonald’s has learned, marketing to African Americans in the mainstream media (outside of the typical Black TV programming) literally helps drive the success of the company. The government (and manufacturers) should do the same with the automotive community by taking the following steps:

• 1. Automakers need to go beyond general marketing and connect with each minority group. Toyota is finally doing this with the Prius via commercials and grassroots HBCU educational tours.
• 2. The automakers need to market more appealing hybrids to capture minorities. Both Kia and Lexus have new sporty hybrids that will be hitting the market soon. (Most consumers aren’t into the bubble, space-age look. That just isn’t cool or sexy for most consumers.)
• 3. Automakers have to price their hybrids like non-hybrids. Ford has done this with their new MKZ luxury sedan. Both the gasoline-powered sedan and hybrid model are priced the same.
• 4. The hybrid battery needs to be subsidized by the government. Most consumers aren’t in a position to pay for a few thousand dollars to pay for the hybrid battery once the manufacturers warranty expires.

So, if Obama’s administration expects for consumers to go green, the best means is to grow the business through the minority community. Once they go green mainstream will follow suit… just ask McDonald’s.

Jeff Fortson is an auto analyst and editor of JeffCars.com, an educational car-buying site for women and minorities.

Be sure to read these BEing Green-related content…

• 4/11: Green Machines – 11 Eco-Friendly Cars for 2011
• 5 Easy Ways to Go Green for a Cause
• 7 Jobs That Could Be Green

Ford Taurus SHO (Source: Ford Motor)

While Ford Motor Co. stands alone as the only American automaker that didn’t solicit bailout money from the U.S. government and subsequently file for bankruptcy protection, it was far from unscathed. And as the No. 3 manufacturer of vehicles tries to save an eroding market share on the heels of perhaps the worst year for the industry, environmentally aware and African American consumers could play a pivotal role in its future.

With the industry still in a state of flux and consumer demand remaining questionable, Ford sees the minority space—and, of course, the environmentally conscious consumer—as areas of increasing importance as it looks to regain lost market share. “The great thing about Ford, particularly in the last year where everyone else cut multicultural marketing—our spending actually went up,” says Crystal Worthem, manager of Multicultural Marketing at Ford. “We do the print ads and TV and try to find ways to communicate with the customer to help change their mind, and we’re especially doing it in the African American community.”

Expanding minority-owned and -operated dealerships in minority communities is key to Ford increasing auto sales, says McGrath. “There is an opportunity to become a dominant presence in minority neighborhoods if [minorities] invest in it. It tends to be an underserved market,” he says.

All told, African Americans spent $11.5 billion on new car sales, using an average retail price of $20,000 per vehicle, according to Marc Bland, multicultural marketing lead for R.L. Polk, a provider of automotive information and marketing solutions.

Ford’s Worthem says the best way to speak to those consumers is through one-on-one relationships and the company has responded to that trend. “So from awareness to purchase consideration all the way down to sales, they’ll take a look at you when you’re at those one-to-one events more often than somebody from the general market. Ford realizes that the African American market is critical to us selling product and driving profits.”

These marketing strategies come on the heels of a steady rise in competition—primarily from Asian companies—and a shift by consumers away from the more profitable large pickup truck and SUV

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segments to smaller, less profitable crossover utility vehicles (CUVs). According to Standard & Poor’s, this shift has led to a steady erosion of Ford’s U.S. market share that the research firm says is likely to continue to hurt market share until the company can introduce more of its own CUVs.

Earl Lucas, designer of Ford Taurus SHO

On the green front, Ford has committed to produce half a million Ford, Lincoln and Mercury vehicles annually using EcoBoost Technology in North America over the next five years. EcoBoost uses gasoline turbocharged direct-injection technology—which takes waste energy from the exhaust gas to drive the turbine. This gives the car up to 20% better fuel economy and 15% fewer carbon dioxide emissions versus larger displacement engines. “I think we are getting a lot of credit for not only having fantastic vehicles that people want to buy that are really fuel efficient, but from an environment standpoint [we] are also doing it in a more environmentally conscious way,” says John Viera, director of sustainable business strategies at Ford.

Although Ford finished 2009 profitably, it wasn’t without its share of sacrifices over the past few years. In December 2005, Ford sold its Hertz Corp. unit for about $15 billion. In June 2008, it sold Jaguar and Land Rover to Tata Motors for $2.3 billion and reduced its stake in Mazda from 33% to 13.8%. In December 2009, Ford announced plans to close the sale of its Volvo unit to China’s Zhejiang Geely Holding Group Co. Ltd. in the 2010 second quarter.

Even still, Bland predicts that Ford will increase its market share both overall and specifically in the African American segment. For one, Ford’s Lincoln brand was ranked No. 2 for African American brand share in 2009, according to statistics from R.L. Polk.

And although the Ford brand ranked No. 13 for African American brand share, the Ford Motor Corp. ranks No. 1 for African American loyalty, based on R.L. Polk’s evaluation of return customers. Also, of the top 12 makes and models for African Americans, the Ford Fusion is the only vehicle to sell more units in the model year of 2009 than they did in 2008. “The market overall was down in 2009 and somehow they found a way to sell more units to the African American community that year than the previous year,” says Bland. “That is a strong indicator that there is a high affinity for the Fusion in the African American community.”

In terms of the general market, McGrath says that the “Toyota debacle” involving the competitor’s recall of faulty vehicles, will definitely open up more market share for domestic manufacturers, giving Ford a chance to increase market share. “There is a lot of positive momentum and consumer buzz about Ford,” says Bland, who based his forecast on the 2010 North American International Auto Show where Ford won quite a few awards. “That leads me to believe they are primed to do some really good things in 2010.”

In a six-speed automatic or manual transmission, the Chevy Camaro gives more options for your pocket than almost any other sports vehicle on the road—and more car for your money. Offering the power and handling that make the Camaro a classic, the LS, 1LT, 2LT, 1SS, and 2SS range from $22,680 to $33,745, with a V6 or V8 engine and 304 or 426 horsepower depending on the model. But there are a variety of features available across the line models, such as OnStar road assistance and rear parking assist. For more information, check out www.chevrolet.com/vehicles/2010/camaro/overview.do.

Road Ready

It’s the ultimate lifestyle drive for those who work smart, play hard, and chart their own course. The four-door sports vehicle is a unique design for Porsche. With 400 horses pushing 0 to 60 mph in 4.8 seconds, road warriors can customize their choice of the Panamera S ($89,800), the 4S ($93,800), or the Turbo ($132,600), from color to wheel combination. The vehicle comfortably seats four and the trunk fits up to four suitcases—which can be ordered through Porsche Design Studio to match the car exterior. And the Travel Club can plan your next exotic road trip. Get the details at www.porsche.com/usa/models/panamera.

A Techno Smart Car

With 365 horsepower and a V6 engine that runs like a V8, the 2010 Ford Taurus is powerful and fuel efficient. Its sculpted design and spacious interior gives it a competitive look and feel. It has a six-speed select shift automatic transmission and a base sticker price of $25,995, which makes it affordable. But it’s the technology that makes it the best auto deal going. The multicontour active front seats change shape for a more relaxed ride; radar systems anticipate driving challenges with blind spot warnings and traffic alerts; and adaptive cruise control can automatically reduce the speed of your vehicle in traffic. Visit www.fordvehicles.com.

This article originally appeared in the November 2009 issue of Black Enterprise magazine.

Detroit is known by many names: The D, Motor City, and Motown, among others. But this once sprawling metropolis of nearly 2 million has over the past few decades become more synonymous with poverty, crime, unemployment, and urban blight. With a population half the size of its glory days, the city now struggles to find a new identity as the auto industry—its economic engine—continues to shrink.

Challenges abound for this struggling city and its mayor. Dave Bing, elected in May to complete Kwame Kilpatrick’s term after the latter resigned amid charges of corruption, is contending with the city’s approximately $300 million deficit and a more immediate budget shortfall that he says could leave Detroit without operating capital by the end of the year.

Despite all the bad news in Detroit—and there has been plenty—hope remains. In fact, one of the keys to revival can be found in TechTown. This 9-year-old nonprofit organization is providing new companies with services, support, and resources needed to grow and thrive. The 100,000-square-foot business incubator facility—Michigan’s largest—was a former car factory built in 1927. Now, it’s home to nearly 90 companies—about 40% of which are African American-owned.

Carla Walker-Miller, one of TechTown’s residents, says the incubator gave her the support she needed to help grow her business. “I wouldn’t be as comfortable in business as I am right now and I wouldn’t be as hopeful,” says the president and CEO of Walker-Miller Energy Services L.L.C., a supplier of electrical equipment and provider of energy optimization services. “TechTown gives us the wherewithal to dream bigger and to accomplish bigger than we would have otherwise.”

Walker-Miller, whose company generated some $4 million last year, has been in TechTown for five years, having taken advantage of its mentoring services, as well as phone support and access to conference rooms to hold meetings.

TechTown helps foster innovation and entrepreneurship —vital components for a new Detroit that can no longer be a one-trick pony banking on the restructuring of a devastated automotive industry. “Instead of having 90 companies today, when you come back in three years’ time, our challenge is to have 500,” says Randal Charlton, TechTown’s executive director. “That’s one new company in Detroit every 2.7 days, from now until 2012, so this is the start of a revolution.”

But a revolution has to be fought on many fronts. The creation of tech jobs is but one battle in a series of wars this city must fight to achieve true revitalization. For a century, Michigan has been the automotive capital of the world, boasting seven times more jobs in this sector than any other state in the nation. The industry has also given birth to some of the largest black-owned businesses—many ranked among the be 100s. But since 2000 the city has lost three-quarters of its automotive jobs, and its unemployment rate has surpassed 15%. Amid this backdrop, black enterprise takes a diagnostic look at this troubled city to see what tools and parts are needed for a successful Motor City overhaul.

Troubleshooting

It’s easy to spot Detroit’s myriad problems. Roughly one-third of its residents live below the poverty level. It has a crumbling  infrastructure, a bankrupt school system, and a housing climate so abysmal that the median price for a home stood at around $6,500 in June. Charlton sums up Detroit’s status in stark terms: “You’re in the economic equivalent of Stalingrad in the last war. We are on the front line of the recession.”

On the political front, Detroit has suffered severe blows in recent years, with corruption scandals leading to the ouster of Kilpatrick as well as City Councilwoman Monica Conyers pleading guilty to bribery and conspiracy charges for her vote on a sludge fund contract. Trust must be restored in city government—one of the many challenges for Bing, the former basketball superstar and founder of The Bing Group (No. 33 on the be industrial/service companies list with $130 million in revenues). Bing’s plan to address the budget shortfall through furloughs for city employees and proposed service cuts to bus lines  has drawn the ire of city residents and the loss of support from the American Federation of State, County and Municipal Employees (AFSCME), the city’s largest labor union.

AFSCME leaders contend that a disproportionate number of union workers are being affected by the cuts. “We’re saying that everybody needs to share in this equation, that nobody should go unscathed,” says Albert Garrett, president of Michigan Council 25 of AFSCME. All told, the city is attempting to remedy an $80 million cash shortfall this year. Meanwhile, if Bing wishes to keep his job (his term expires this month), he must fend off challenger Tom Barrow, who gained the support of AFSCME.

One might think Detroit’s challenges began with the recent crisis. But residents and other observers say otherwise. The fact is Detroit wasn’t always a one-industry town. At the beginning of the 20th century it was a major producer of ships, stoves, and tobacco. But the wildly successful Ford Model T led to an automobile frenzy that at its peak had some 300 auto manufacturers competing in Motor City. By the 1920s its economy boomed, manufacturing more than 60% of the nation’s cars. After World War II when the population began to shift to suburbia, Henry Ford and other entrepreneurs decided to build factories outside of Detroit. By the 1950s, despite being the country’s fifth largest municipality with about 1.8 million people, there were virtually no new factories built within city limits. “The idea of the modern American city was the suburban lifestyle. It was not living in the inner cities because they were considered dirty and dusty and old,” says Janese Chapman, a city planner and historic preservationist for Detroit’s Historic Designation Advisory Board.

Thus, Detroit went from one of the wealthiest cities in the country to becoming victim of a gradual exodus that lasted decades. Between 1947 and 1963, it lost 134,000 manufacturing jobs; as a result, more than half of the residents left over the next few decades. The greatest shift took place during the 1967 civil disturbance, which escalated “white flight,” further eroding the  city’s tax base and industrial activity.

By 1973, the city elected its first black mayor, Coleman Young, who inherited an economic mess—a staggering fiscal crisis, municipal employee layoffs, and the threat of plant closings. He brought the city back from the brink of bankruptcy by revitalizing the city’s waterfront and, in the process, bolstered the black entrepreneurial class through his administration’s minority set-aside program.

As the city was being redeveloped, however, the gas crunch of the 1970s helped open the door to competitive pressures from foreign automakers. Models that were smaller, more fuel efficient, and cheaper to make than American muscle cars enabled companies such as Honda and Toyota to grab a foothold in the American marketplace and take market share from the then-reigning Big Three: General Motors, Ford Motor Co., and Chrysler Corp.

By the 1990s, Detroit was enjoying a boom due to the growing economy and a vibrant manufacturing sector. Then-Mayor Dennis Archer presided over a city that was ranked No. 1 by Industry Week magazine on its listing of world-class communities. Black businesses, particularly auto suppliers and car dealers, grew at an exponential rate. By 1998, Michigan had more be 100s companies than any other state in the nation.

“The automotive industry was very good to black entrepreneurs here, but it also made us collectively not as aggressive on our game because it was such a lucrative industry,” says Louis Green, president of the Michigan Minority Business Development Council. “There was no urgency to diversify or explore other options.” And when all-time highs for crude oil combined with the subprime-fueled erosion of the U.S. economy, this perfect storm sent the auto industry into its worst slump ever—and took Detroit with it.

Diagnostic Measures

So the prognosis is simple: Detroit must attract industries outside of the struggling automotive space, wooing both large corporations as well as fostering entrepreneurial growth. Since no single industry can produce the job and wealth creation the auto sector did in its heyday, the city must transform itself into a magnet for as many industries as possible. This renaissance will also be fueled by the development of small businesses and minority-owned enterprises (blacks comprise 81.6% of the city’s population). For instance, automotive suppliers must rethink their business plans. “We’ve got to recognize that new entrepreneurial efforts, startup companies, new companies from overseas, or part of the wind wave—solar, advanced energy storage, battery systems, biomass systems, geothermal systems—are going to be key,” says Keith W. Cooley, president and CEO of NextEnergy, Michigan’s renewable energy industry accelerator.

It’s not like the Motor City doesn’t have its plusses though. After all, the area was a strategic trading post in the 1700s and 1800s because its vast waterways made it accessible. It also has extensive highway and rail systems. In fact, 60% of the U.S. population can be reached overnight from Detroit by land or sea. Then there’s the access to the Canadian market by way of nearby Windsor, Ontario. And it has two college campuses: University of Detroit and Wayne State University. Combined with a willing workforce, low-cost housing,  cheap factory space, and a major international airport, you have a city with the ingredients needed to participate in a 21st century economy.

The Kings see renewable energy as Detroit’s future (Credit: Ara Howrani)

But first there must be a change of culture. “I think Detroit really suffers from a lack of entrepreneurial spirit. It’s mostly a function of the fact that the auto companies have been so successful for so long and they built such a big corporate culture that permeated thinking at all levels of society there,” says Donald Grimes, senior research specialist for the University of Michigan. “You’re on your own more now than you’ve ever been. People have to recognize that. I don’t think they’re going to be able to find big institutions figuring out solutions to their problems.”

Michigan Gov. Jennifer Granholm wants to shift the state’s massive manufacturing capabilities to serve the emerging green economy. “We know that technology associated with the auto industry can be transferred to produce better materials for wind turbines and solar panels. We want to identify the natural strengths we have based upon our traditional base and move them into areas we know are up and coming, like the green economy.”

Today’s Motown Enterprises

Jimmy and Natalie King are among area residents who understand this. They also view renewable energy as being an important element in Detroit’s economic revitalization. As owners of J King Solar Technologies L.L.C., which engineers, designs, and installs solar paneling, primarily for commercial facilities, the husband-and-wife team is hoping to get a piece of the retrofitting pie as city- and state-owned buildings are brought into the 21st century with renewable energy or energy-efficient additions. Based in nearby Southfield, Michigan, the startup company, funded with roughly $180,000 from a combination of the couple’s funds and outside investments, has just one project: installation of a 145 kilowatt solar photovoltaic system in Bordertown, New Jersey. In the fall, J King Solar Technologies will be one of several vendors participating in DTE Energy Co.’s solar pilot program offering rebates to residential and small business clients.

The firm only netted about $10,000, but the Kings remain optimistic about future prospects. Jimmy, 36, a member of the University of Michigan’s famed “Fab Five” basketball team would like to see Detroit capitalize on what many consider a growth industry. “You look at the infrastructure of the city and the state itself; we have a lot of manufacturing capability,” he says. “We’d love to see green-collar jobs come to the city. That was a major factor in our determination to start this business.”

The Kings have tapped into an area where there’s plenty of money to be made. According to the LOHAS Journal, a publication that tracks economic trends, green products and services generate roughly $209 billion a year—a number that’s only expected to grow as more Americans adopt more eco-friendly practices. With its vast manufacturing capability, Detroit can capture a significant portion of these dollars through the development of wind turbines, solar panels, and energy-efficient batteries. That’s where legislation can help. “The state must have strong incentive programs that will make investment in a renewable energy system make sense—that’s when you create jobs,” says Natalie, 35. “Then developers will begin to write solar into their specs since it’ll make economic sense.”

Gov. Granholm hopes Detroit's manufacturing, transportation, and construction capabilities combined with inexpensive housing could lead to renewed interest from large and small businesses in growth industries.

 The New Growth Industries

Beyond the green space, four other industries could provide significant jobs and tax revenues. They are:

Motion Pictures: Even in a brutal economy, the motion picture industry managed to grow 1.7% in 2008 with the domestic box office generating $9.79 billion. Detroit is positioning itself as a major player by making tax incentives available to filmmakers. According to city officials, 68 films were produced in Detroit last year including 12 major motion pictures. Transformers, Dreamgirls, and Gran Torino are among big-name films shot there in recent years. “This was an entertainment city for a long time and you’ve still got a generation or two removed from the great Motown years where we still have a lot of talented young folks here and they don’t want to leave,” says Bing.

Healthcare: The healthcare industry is one of the largest in the U.S. with estimated expenditures (which include prescription drugs) of $2.2 trillion—that’s trillion, not billion. The city is home to Henry Ford Health Care System, Detroit Medical Center, St. John Health System, and Beaumont Hospitals. According to Bing, these facilities have been growing on average more than 10% a year for the past five years and are projected to expand at the same rate over the next five years.

Construction: The Bing administration is working with the federal government to make Detroit a priority in its economic recovery initiative. In June, the federal government approved nearly $125 million in funding for the city to attract jobs and investment through its recovery bond program—funds that can be used to rebuild roads and infrastructure. A proposal to revamp the city’s woeful mass transportation system is under consideration.

Automotive: Auto may be a four-letter word in southeast Michigan, but people are still going to buy cars and Detroit will likely remain the center of the U.S. automotive industry. If American automakers such as General Motors and Ford can turn around their fortunes as smaller, leaner players (and analysts are fairly optimistic they can) then the city should position itself as the place where next generation fuel-efficient technologies are developed. “One of the big bets that we are making is that electric vehicles will be an integral part of the automotive platform and strategy for years to come,” says Rod Gillum, GM’s vice president of corporate responsibility and diversity.

For these industries to take root and thrive, however, it’s imperative that Detroit ensure its business incubators and training and educational programs remain open to produce the next generation of entrepreneurs. This means financing. And believe it or not, Michigan has it. “You go 50 miles down the road to Ann Arbor that God knows is wealthy enough. They’ve got something like 17 venture capital companies of one sort or another in that small town, feeding off the university expertise,” says TechTown’s Charlton, pointing out that there’s just one such firm in  Detroit—Oracle Partners. “Job No. 1: You’ve just got to raise investment funds to invest in these small businesses.”

Surprisingly, Big Tobacco could well lend a hand to Motown’s efforts. In the mid-1990s, Michigan joined 45 other states to sue the tobacco industry seeking compensation for healthcare expenditures for ailments arising from tobacco use. Michigan’s initial payment from the tobacco industry was $104.5 million, to be followed by $279 million to $365 million annually for 24 years. The state securitized those settlement dollars to create a $2 billion fund to invest in alternative energy, advanced manufacturing, homeland security/defense, and life sciences over a 10-year period.

Repairing the School System

As one would imagine, a full economic turnaround is not only decades in the making but also rife with challenges. Perhaps the biggest in the case of Detroit is the poor educational attainment of its residents. Metropolitan areas that succeed tend to have a thriving central city with a highly educated population. In Detroit, roughly 11% of residents 25 years and older have a bachelor’s degree. Grimes says: “If you look at Seattle it’s over 50%; Boston is over 40%. It’s really important to have an educated population in your central city and Detroit does not have that.”

Illustrating this point, an April 2009 study by the EPE Research Center, a division of the nonprofit Editorial Projects in Education Inc., ranks Detroit’s graduation rate 48th out of the 50 largest cities—ahead of only Cleveland and Indianapolis. Some 27% of its students dropped out in 2008, and only a fraction of its high school graduates go on to college or technical school. This is a serious issue for a city whose workforce may not be ready for industries policymakers are hoping to attract. Granholm is trying to address it statewide by offering scholarships to every student in Michigan who graduates from high school. “We’ll give them a $4,000 scholarship to college, which is essentially two years of community college tuition here,” she says. “No matter where you are, no matter where you live, we want to double the number of college graduates, which is part of the strategy to diversify our economy.”

In response to the school system’s projected $259 million budget deficit following years of mismanagement, Granholm appointed Robert C. Bobb as emergency financial manager for the Detroit Public School System earlier this year. He assumes full financial authority for a school district with a sharp decline in student enrollment and poor academic performance. To solve its fiscal problems, Bobb may be forced to file Chapter 9 bankruptcy (the chapter of the Bankruptcy Code providing for reorganization of municipalities). He believes that to resolve long-term financial issues, the school system must “put in place, aggressively and urgently, methods for 21st century teaching and learning.”

Young, encourages Detroit’s youth to pursue careers in the sciences. (Credit: Ara Howrani)

Taking Matters In His Own Hands

Recognizing the shortfalls in the city’s public school system, particularly in the sciences, Keith Young decided to do something about it on his own. As founder and executive adviser for Ecotek, a nonprofit scientific research organization, Young helps develop future global scientists and young inventors. “The goal is to put them in a position, through hands-on work, to be able to compete with other folks around the world,” he says.

There are currently 15 children, ages 10 through 17, in the 5-year-old program, funded through Young’s business consulting service combined with not-for-profit grants. He cites that virtually all Ecotek projects, including the development of biofuels from ingredients such as soybeans, corn, and grape seed oil, originate with United Nations member countries. He asserts: “The expectation is that through my experience and background and access to resources, it will create opportunities for our kids to work and develop as global leaders.” His goal: open up as many research laboratories as possible in the United States and abroad while ensuring student scientists are able to develop inventions and gain recognition—not only in the form of scholarships—but also notoriety in their fields.

Young believes the sciences are critical to Detroit’s future. “If we do not bite into this apple called scientific research and get on the cutting edge of biotech, biomaterials, geospacial technology, and all the different technologies that drive location-based knowledge, we’re finished, it’s over,” he says. “We won’t be able to sell enough cars to recover what we have lost.”

Pittsburgh Primer

Overhauling a city is a dauntingly complex task—one fraught with thousands of potential missteps that could derail any potential progress. Once the nation’s eighth largest city and producer of nearly half of America’s steel, Pittsburgh hit rock bottom in the 1980s when competitive pressures from Germany and Japan led to a decline in the U.S. steel industry. Eerily reminiscent of Detroit’s situation, Steel City was battered by widespread layoffs (unemployment reached a staggering 18.2% in January 1983), mill closures, and mass departure of nearly half of its population, from approximately 600,000 residents to some 360,000 by 1990.

However, the city administrators shifted its economic base by attracting new industries and offering incentives to a range of corporations. “We’ve reinvented ourselves since the downsizing of the steel industry and some of our other industries in the 1980s,” says Andy Masich, president and CEO of the Senator John Heinz History Center. “That has allowed us to diversify into things like high-tech industries, robotics, healthcare, nuclear engineering, financial services, and education.” In addition, foundations and corporations endowed many of the city’s arts institutions, contributing to a higher quality of life.

While struggling with many issues urban centers are facing in today’s brutal economy, Pittsburgh’s unemployment rate (as of July) was 7.8 % vs. 9.7% for the entire U.S. And while the city’s poverty levels are high at 20.1% (the most recent figures available), it remains substantially below Detroit’s 33.8%. “I think Pittsburgh is actually doing better than the rest of the country,” says Masich. Underscoring this, Pittsburgh was named most livable city in the U.S. by The Economist earlier this year.

TechTown’s executive director is positive the same miracle can happen in his city—partially due to its prime location next to the country’s most heavily populated areas, which is desirable for international businesses looking to move products throughout the U.S. “I think we are going to be the gateway to America,” says Charlton. “We are going to be the place where the rest of the world comes into because it’s low cost and because the rest of the world wants to get into the biggest market of the world.”

Detroit has a rich history as the birthplace for scores of successful black entrepreneurs—from Berry Gordy of Motown, which was the nation’s largest black-owned business for more than 20 years, to Don Barden, CEO of Barden Cos. Inc. (No. 10 on the be industrial/service companies list with $455 million in revenues). A revitalized Motor City would not only provide jobs and business opportunities for this predominantly black city, but also serve as the primer for future urban revitalization projects to follow.

Can Detroit be saved? Given time and through great effort, absolutely. But only if policymakers, powerbrokers, and residents make the necessary changes, sacrifices, and successfully navigate the scores of obstacles that stand in the way.

This article appeared in the November 2009 issue of Black Enterprise magazine.

The woes of the auto industry have dominated business headlines all year – which has had and will continue to have a devastating toll on African American suppliers. “We had some projections going in that we might lose 50% of the black automotive suppliers. Now, with having a better sense of some additional data, it may be closer to 75%,” says Louis Green, president of the Michigan Minority Business Development Council. “They are probably responsible, just that group that might go away, they’re probably responsible for 38 to 45,000 employees. They provide a lot of opportunities to the black accountants, black IT firms, black marketing the trash and trinkets.”

This industry will most likely remain inextricably linked to Detroit and will continue to have an impact on the future of this city – even as the former Detroit Three struggle to regain their footing and market share. “One of the big bets that we are making is that electric vehicles will be an integral part of the automotive platform and strategy for years to come,” says Rod Gillum, vice president of corporate responsibility and diversity. “So we start talking about the Chevrolet Volt, with plug-in technology, we think we’re ahead of the game, we’re going to be the leader of the pack, and we’re going to bring out the vehicle next year.”

Should this vehicle – and others like it – succeed, this creates yet another opportunity in Motown. No infrastructure is currently in place to equip traditional gas stations with plug in ports for electric vehicles. “You have to put those in garages, you have to put those in carports, you have to locate those around cultural institutions. There will be hardware that will be required for that technology,” says Gillum. “Someone has to install that, someone has to manufacture the hardware, someone has to put it in commercial locations. So we fully expect that there will be a robust industry built around all the requirements associated with it.”

While General Motors places part of its hopes on electric powered vehicles (which have failed in the past), one thing is certain: the automobile isn’t going away and the automakers will continue to have an impact on the city in which they’ve operated for the last century. “GM is on good, solid footing. I don’t buy all of their rosy outlook regarding floating stock next year and being able to pay back the government real quick,” points out George Magliano, who heads US auto analysis for Global Insight, a provider of financial analysis, forecasting and market intelligence. “I think it’s going to take them awhile but they’re definitely going to survive. The Chrysler Fiat deal has a lot more risk involved but I think at the end of the day, they’re still going to be there. Ford is on good footing. They’ve ridden to the top of the heap right now.”

Magliano remains cautiously optimistic about the industry but sees the landscape continuing to evolve in Detroit. “The industry has been shifting all along. It’s not new. We’ve gone from the Big 3 to the Detroit 3 to the Big 6 and with this bankruptcy reorganization, you’re going to have different people in this business,” he says. “It’s a whole gamut of different things we’re going to be living with for awhile. The whole face of this industry has changed where Detroit controlled it and felt it was born into this business and this is the way it operated and it’s not that way anymore.”

Further Reading:

Can Detroit Be Saved?

Tourism Holds Prime Opportunities

Aerotropolis Is Expected to Help Revive Detroit’s Economy

In their monthly reports, all the major automakers spoke optimistically about economic conditions, and believed that the latest developments would bring a better future.

Sales of the Ford Fusion rose 9.4% despite an overall drop in sales for the company. (Source: Ford)

Ford Motor Co.

Ford  sales fell 24% in May from the same period last year, but sales rose 20% from April as the Michigan-based automaker continues to gain market share from its U.S. competitors, General Motors Co. and Chrysler L.L.C., who are now under bankruptcy protection.

The only major U.S. auto company without bankruptcy woes, Ford sold 161,197 cars and light trucks, with sales of the Ford Fusion rising 9.4%.

“Consideration for our new products is increasing,” said Ken Czubay, vice president of sales and marketing at Ford. “Even as the competitive environment intensifies, Ford’s relentless pursuit of quality, fuel efficiency, smart technology and appealing designs is winning new customers.”

Sales for its Ford, Lincoln, and Mercury brands dropped 24% to 155,954 vehicles in May compared with last year.

The Chevrolet Equinox was one model that saw retail sales increases in May. (Source: GM)

General Motors Co.

One day after the Detroit-based automaker filed for Chapter 11 bankruptcy protection in New York, General Motors reported a 30% decrease in May car and light truck sales, compared with last year.

GM sold 191,875 vehicles, with total truck sales at 110,866, a drop of 22%, and car sales at 81,009, down 38% compared with a year ago.

“We were able to record our best monthly sales result of the year in May as we are seeing more positive signs in housing and consumer confidence in the market,” said Mark LaNevea, a GM vice president. “Those signs, along with more clarity on the new GM, are providing some additional consumer confidence.”

Chevrolet car retail sales were up 28%, and the Silverado, Colorado, HHR, Equinox, Tahoe, and Traverse saw retail sales increases.

Four brands, which will be dropped in a restructuring of the company — Pontiac, Saturn, Saab and Hummer — reported larger sales drops than GM’s overall decrease, with the worst being a 63.5% drop in Saab sales. The company announced Tuesday it sold its Hummer line to a company whose identity has yet to be disclosed.

The Jeep Wrangler had strong retail sales in May, up 8% compared with last month. (Source: Chrysler)

Chrysler L.L.C.

Chrysler reported sales of 260,407 vehicles in May, a 47% decrease compared with May 2007. This comes after a U.S. bankruptcy court approved the sale of the majority of the automaker’s assets to a new company, Chrysler Group L.L.C. in alliance with Fiat S.p.A.

“Overall our sales were above expectations during this month of transition,” said Chrysler President Jim Press. “The uncertainty that has been surrounding Chrysler for the last few months is coming to an end, and a vibrant, new company is beginning to take shape,” Press added. “One that will better serve our customers and dealers with a broader and more competitive lineup of environmentally friendly, fuel-efficient, high-quality vehicles.”

The Jeep Wrangler had strong upward sales for the fifth month in a row, with May retail sales up 4% year-over-year, and up 8% compared with last month.

Toyota

Toyota reported a sales drop of 40% in May, compared with a year ago, selling 152,583 vehicles.

“We’re encouraged that consumers are beginning to return to showrooms and that the industry continues to show signs of stabilization,” said Don Esmond, a vice president at the company.

The Toyota division reported sales of 135,661 in May, a decrease of 39% from the same period last year, while the Lexus division reported sales of 16,922, a drop of 33.9% from a year ago.

Sales in Japan for Toyota’s new third-generation Prius hybrid have been booming.

With 3,375 units sold, the Acura TL sedan was the division's top seller. (Source: Honda)

Honda

Honda reported a 39% decline in May sales, retailing 98,344 vehicles. Total car sales decreased by 49% to 51,947 and light truck sales saw a drop of 19% to 36,928.

“Staying true to the course of providing fuel- efficient, high-quality, fun-to-drive vehicles will hopefully help see us through to the economic recovery,” said John Mendel executive vice president of sales for American Honda.

The Acura division reported sales of 9,469, a decrease of 34% compared with May 2008. With 3,375 units sold, the TL sedan was the division’s top seller.