IBJNews

  • Home

Chrysler plans $162 million plant, 850 jobs in Tipton

Dan Human
December 17, 2012
Keywords
Auto Industry, Automakers, Chrysler, Economic Development, Economic Development Incentives, Government & Economic Development, Manufacturing & Technology, Other Counties, Tax Abatements
Back to TopCommentsE-mailPrint

Editor's note: An earlier version of this story included an incorrect value for the 10-year tax abatement approved by Tipton County officials Monday.

Chrysler Group LLC plans to spend $162 million to open a transmission plant in Tipton that will employ up to 850 people, the automaker disclosed Monday morning.

Tipton officials on Monday approved a 10-year tax abatement worth $2.5 million to help the company launch production in an existing, nearly 800,000-square-foot plant at U.S. 31 and State Road 28, about 25 miles north of Carmel.

The plant, which is about a half-hour south of the company’s transmission plants in Kokomo, never has been occupied. Chrysler partnered with Getrag Transmission of Germany in 2007 to build the plant, which had been expected to employ 1,200 and make dual-clutch transmissions. But that partnership unraveled the next year, halting construction of the plant.

Chrysler now says it will use the plant to make a new line of nine-speed transmissions. The company said it hopes to begin installing equipment at the facility in June 2013, which would allow it to launch operations by the end of 2014.

The automaker has been growing rapidly in central Indiana in recent years, adding about 1,000 jobs in Kokomo since emerging from bankruptcy reorganization in 2009.

The Tipton project isn't the only expansion Chrysler is proposing for north-central Indiana. Chrysler spokeswoman Jodi Tinson confirmed Friday that the automaker has asked Kokomo to approve additional tax abatements for another investment, but she wouldn't discuss details.

Kokomo officials are expected to vote on that request Monday night.

Brian Harlow, the vice president of Chrysler's power train division, said Monday that booming demand coupled with the government's looming fuel-efficiency mandates have pushed the company's Kokomo factories toward capacity.

The company needs more lines to produce the nine-speed transmissions designed by German firm ZF Group.

Harlow said the Kokomo expansion plans are "tied into" the Tipton County project, but he would not release further information.

This will be Tipton County's third attempt to fill the massive building and Chrysler's second attempt to inhabit it.

After Getrag abandoned plans for the plant, Colorado-based solar panel maker Abound Solar received a $400 million federal loan guarantee in 2010 to launch operations in the facility. But the company filed for bankruptcy liquidation earlier this year, scuttling the plan.

The Associated Press contributed to this story.

 

 




 

ADVERTISEMENT

  • Pay your fair share
    MikeyDecember 17, 2012 3:49 PM
    It's time these company's start to pay there fair share of taxes. they dont need more taxpayer money given to them. these huge company's act like doing business in this country is free, and they wonder why our gov't is going broke. this is why, along w/ the outrageous spending. STOP THE FREEBIE TAX BREAKS TO MULTI BILLION DOLLAR COMPANIES!
    Reply to CommentFlag Comment
  • Thanks Mitch
    Betr'nuDecember 17, 2012 2:55 PM
    Another miracle of Daylight Savings Time!!HoooooooRaaaaayyyyyyyy!!
    Reply to CommentFlag Comment
  • Corrections
    Adding Machine QueenDecember 17, 2012 12:58 PM
    You might want to conduct more (some?)research. First of all, the article was about Chrysler, not GM. I'm not sure I follow your math. The IBJ wrote an article on February 26, 2012 that informed us how Kokomo has faired during the ups and downs of the auto industry recently. It also said "Chrysler and Fiat have paid back all but $1.3 billion of Chrysler's $12.5 billion bailout." Ironically, this remaining amount is also mentioned later in the article. "Flash forward. The U.S. auto industry has staged an amazing comeback, and the town's largest employer, Chrysler, has pledged to invest nearly $1.3 billion into its plants here, added about 1,000 workers and helped boost Kokomo's fortunes — it was honored in 2011 by the state chamber of commerce as Community of the Year." I am perfectly fine with them using the $1.3 Billion to create 1,000 new jobs. Taking their $49M abatement and dividing it by the number of workers of 850 to get to $57K doesn't make sense to me. The $49M is over a 10 year period, or $4.9M a year. This means just $5,765 per employee, per year. Certainly we can agree that amount of money will be returned in increased tax revenue from these employees, right? That doesn't even take into consideration the fact that they have "added 1,000 jobs in Kokomo since emerging from bankruptcy reorganization in 2009." Sorry, occupational hazard I'm afraid - accountants can be sticklers for the numbers actually making sense. I see this announcement as a WIN-WIN for this area of Indiana. Who are you referring to when you mention "the locals"? Are you referring to the 850 local employees that would now have jobs? I'm confused. The Queen of the Adding Machine
    Reply to CommentFlag Comment
  • GMC?
    JohnDecember 17, 2012 12:41 PM
    You do realize it's Chrysler, not GMC, right? And yes, tax incentives were used. It seems your argument is that, based on a fantastical belief that a company may someday open up the plant and create those jobs without government incentive, you would rather pass on the jobs now. Is that right? I think you'll find that most will disagree. For four years people have complained about the loss of jobs in Indiana, specifically manufacturing jobs. Now that some are being created you're complaining about the method in which they are created. Some people are never happy...
    Reply to CommentFlag Comment
  • Corporate Welfare
    QDecember 17, 2012 11:44 AM
    Yes, we need jobs and it's good that GMC is deciding to use a newly built plant that's never been used. However, the $49M abatement (probably property tax) is equal to $57K per job. At 25% taxes (state and fed), the local is giving away $57K and getting back about 10%, $5700 in local and state income taxes per job. The rest goes to the bottom line of GM, Government Motors. Still, that's about $12M in revenues the government (fed, state, local) would not have gotten. But it's 36M they won't get. If they need it (which the property tax says they do), then it will come out of the local's pockets. This happens everywhere.
    Reply to CommentFlag Comment

    Post a comment to this story

    COMMENTS POLICY
    We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
     
    You are legally responsible for what you post and your anonymity is not guaranteed.
     
    Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
     
    No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
     
    We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.
     

    Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

    ADVANCED SEARCH
    Sponsored by
    ADVERTISEMENT

    facebook - twitter on Facebook & Twitter

    Follow on TwitterFollow IBJ on Facebook:
    Follow on TwitterFollow IBJ's Tweets on these topics:
     
    Subscribe to IBJ

    1. Many serial killer types and psychopaths work as lowly bureaucrats, just waiting to impose their wrath on a powerless person, child, or pet. Don't forget, the BTK killer was a dog catcher.

    2. If a television station wants to improve viewership, get rid of the local blackout. I was born by the brickyard, and have attended 15 or more races. I have children now, I won't attend unless circumstances are perfect. As those with growing families know, they never are. I'm always impressed that upwards of 250,000 people attend the 500. However, as a growing, or, more apt, sprawling city, Indianapolis and its immediate suburbs count almost 2.2 million. Show the race live, let the venue get a kick-back on revenues, and open-wheel racing might have a fighting chance to be relevant again. Just in time for those tax-payer lights to make sense.

    3. John Moore, I too have had the same issue recently. A property next to my house was on the Land Bank and I was interested in purchasing. When I tried to contact Reggie, I got back emails that had nothing to do with what I asked about. Actually my latest response from him was on this past Friday. I had asked about how to buy the property and if it was still available. His response to me was to contact the mayor's office to get the schedule of his appearances. (???) Hopefully the city is able to do something to fix what this guy has done, it would be nice if they would take the properties back and sell them properly so land owners like me and you mother would have a fair chance.

    4. I too work in the industry, with over 25 years of experience and your political spin has probably nothing to do with any rebranding. "Let's dress it up" would have nothing to do with the government "telling us how and what to eat." Give it a political rest. And being a producer for a radio show doesn't mean you've been involved in advertising and branding for 30 years.

    5. Ms. Morris did not understand the ways of the business world, otherwise, like the IMS, she could have petitioned the State Legislature for a handout of State Funds for her charity work. Ms. Morris should consider becoming a state lobbyist for Lemonade Stand Operators.

    ADVERTISEMENT