Michigan is the birthplace of the modern automotive industry, where the automobile was catapulted from a novel product to an everyday necessity. Since the beginning of the auto industry, intense competition, increasing consumer demands, and governmental regulations have created challenges for the auto industry. Automakers are responding to these challenges by innovating—improving their products and operations.

Michigan has been home to much of this innovation.This record of innovation has been assisted by the clustering of the original equipment manufacturers, their suppliers, and first-class universities, which include the University Research Corridor (URC) institutions of Michigan State University (MSU), the University of Michigan (U-M), and Wayne State University (WSU).

The focus of this report is auto innovation and the contributions the URC universities are making to new auto technologies and manufacturing processes. We find that the URC universities contribute to innovation in two important ways:

  • By educating more than 3,600 graduates annually who are ready for technical careers in the auto industry.We estimate that the URC universities grant more than 1,100 degrees annually in the areas of mechanical, industrial, and manufacturing engineering. The URC universities grant another 2,500 degrees annually to students in disciplines like computer science, math, and physical sciences where students are prepared for a number of careers in the auto industry. Almost 13,000 URC graduates from all disciplines currently work at the Big Three (Ford, GM, and Chrysler) companies. During the last five years, URC engineering graduates have been hired by 84 companies in Michigan that engage in automotive R&D.
  • By performing research in auto-related areas totaling more than $300 million in the past five years. More than a quarter of this funding is by private industry, which is nine times more than the average share of industry support for R&D at the URC universities. The URC universities perform basic and applied research that benefit the auto industry in two important ways. First, the URC universities perform basic research that raises the standard level of knowledge in the entire industry, allowing innovation to happen faster. Second, the URC universities work with specific companies and government sponsors to solve problems and assist in product development. Between FY 2007 and 2011, the URC universities spent $300 million on more than 1,400 auto projects. Nearly two-thirds of this research was funded by federal and state governmental agencies. Private industry provided 28% of auto research funding, which is nine times more than the average share of industry support for all R&D at these universities.


The research and development performed at the URC universities has allowed innovation to occur in areas such as improved vehicle quality and safety, reduced fossil fuel use, and improved engine performance and efficiency. Specific examples include: the 2mm project involving U-M and WSU, which limited and controlled the gaps between auto components; connected vehicle research at U-M and WSU that promises improved vehicle safety by allowing vehicles to “talk” to infrastructure and one another; and biofuels research being done by MSU on new types of feedstocks that can be grown more economically to lower fuel costs and improve fuel efficiency.