A plan by Progress Rail Services to create up to 650 jobs in Muncie by 2012 will fall woefully short, according to The Economist magazine.
In a Friday online story detailing the city’s economic struggles, a Progress Rail spokeswoman said the company currently employs 150 people in Muncie and has scrapped the 650 target. It expects to have just 250 employees by the end of 2012.
The spokeswoman blamed the sluggish hiring on the weak economy.
Progress Rail, a subsidiary of Peoria, Ill.-based Caterpillar Inc., in October announced plans to locate a locomotive manufacturing facility in the city 60 miles northeast of Indianapolis.
The company said it would invest about $50 million to open the first locomotive manufacturing and assembly plant in the United States in several years.
The plant is in a 740,000-square-foot facility formerly occupied by ABB Power T&D Co., which closed in 1998.
The Indiana Economic Development Corp. said it would provide Progress Rail up to $3.5 million in performance-based tax credits and up to $1 million in training grants based on the company’s job-creation plans.
In addition, the IEDC said it would provide the city of Muncie with up to $1 million in infrastructure assistance from the state's Industrial Development Grant Fund.
And Delaware County considered a tax abatement, community revitalization enhancement district and tax increment financing request valued at about $22.5 million at the request of the Muncie-Delaware County Economic Development Alliance.
Only about $11 million in state and local incentives have been realized, according to The Economist. Still, that would equate to $44,000 per job.
Founded in 1983, Progress Rail makes, repairs and refurbishes freight cars, locomotives and rail track. In addition, the company oversees the reclamation of used rail, wrecked or retired railcars and locomotives and other scrap metal.
The company has more than 130 operating facilities throughout the U.S., Canada, Mexico, Brazil, Italy, Germany and the United Kingdom.