Allison Transmission plans to invest $89 million to grow its headquarters and manufacturing operations, creating as many as 205 jobs by 2013.

Local and state officials joined executives Tuesday afternoon to announce the plans, tied to a new transmission it has developed for over-the-road commercial trucks.

In addition to expanding and equipping Allison’s manufacturing facilities, the project calls for rerouting West 10th Street in Speedway to consolidate parking lots and accommodate the growth.

Allison, which employs nearly 2,500, hired 50 workers earlier this month, according to a prepared statement. Additional hiring will occur over the next two years as upgrades are made.

The city of Indianapolis will provide $1 million for infrastructure improvements, and another $3.5 will come from federal transportation funds. Develop Indy will support Allison’s application for a seven-year personal property tax abatement.

Last summer, Allison said it would invest $130 million in its headquarters and manufacturing complex to make room for work on hybrid systems for commercial vehicles. It planned to use a $62.8 million Department of Energy grant and $67.2 million of its own. About 100 new and retained jobs were to be associated with that project, the company said then.

Rerouting 10th Street ties into the town of Speedway's ongoing $500 million "Speed Zone" redevelopment, which aims to bring business back to Main Street and create pedestrian zones around the Indianapolis Motor Speedway.

Work on Main Street began this year. Other components of the 10-year project include rerouting 16th Street to the south, away from the track, to create a pedestrian zone near the track. The plan also calls for closing Georgetown Road south of 25th Street, diverting traffic to Lynhurst Drive, to create a park and pedestrian promenade alongside the track.

The town has already vacated Grande Avenue south of 10th Street, where it cuts through the Allison campus.

Allison, the world's largest maker of fully automatic commercial transmissions, also is planning an initial public offering worth an estimated $750 million.