DETROIT -- The U.S. subsidiary of India conglomerate Sakthi Group is building a 60,000-square-foot plant in Detroit to accommodate a new contract to build steering arms and knuckles for Volkswagen AG vehicles, said Lalit Verma, CEO of Sakthi Automotive Group.
Sakthi already has broken ground on a $7 million building at its existing manufacturing and distribution campus in southwest Detroit. The additional operations will create 200 new jobs.
The company, which came to Detroit in 2014, already produces 6 million units of knuckles and steering parts for VW, Ford Motor Co. and General Motors, said Alfredo Newman, senior human resources manager for Sakthi.
Once the new building is complete by next May, the 200 new hires will bring the company's Detroit workforce to 700, Verma said.
"We look forward to future growth in Detroit," Verma said Friday during a formal groundbreaking ceremony with Detroit Mayor Mike Duggan.
The expansion is Sakthi's third since 2014, when the company began production of its steering parts in a former ArvinMeritor operation in the city.
In 2015, the company added 100 jobs at its plant at 150 American Way St. in southwest Detroit. Last year, the auto parts maker opened a new aluminum foundry in the footprint of where the former Southwestern High School's football field once stood.
"Another year, another expansion, another 200 jobs -- and Lalit, we're going to find you some more room," Duggan told the Sakthi CEO.
Sakthi purchased the closed high school and plans to begin using more of it for office and warehouse next year, Verma said.
"We will start pretty soon utilizing the high school, too," Verma told Crain's Detroit Business, an affiliate of Automotive News.
Sakthi began construction of the 60,000-square-foot facility a month ago, Newman said.
Since moving to Detroit, the Indian-owned auto parts supplier has made a concerted effort to hire parolees and Detroiters with felony criminal records. The company says it currently employs 202 returning citizens.
"I have to say, our returning citizens program, it's not a charity program," Newman said. "They are individuals who are held accountable for production and they are adding to the bottom line."
Inside the foundry facility, Sakthi is in the process of shifting production of aluminum-casted steering arm knuckles from China to Detroit.
"We are a one-stop shop going from melted aluminum in, finished product out and right out the door to Ford, GM and Volkswagen," Newman said.