Chrysler Group, hosting President Obama in Indiana, today said it is contemplating an $843 million investment to upgrade a Kokomo, Ind., transmission plant to build a new front-wheel-drive automatic transmission for future models.
Chrysler said that with the project its total investment in U.S. facilities would climb to nearly $3 billion since June 2009. With previous plans to spend $343 million to upgrade the Kokomo plants, those operations now stand to undergo $1.1 billion in renovations, Chrysler said.
The Kokomo City Council still must approve a tax abatement for the operations on Dec. 13.
The Kokomo City Council still must approve a tax abatement for the operations on Dec. 13.
Chrysler said the project would help retain 2,250 job at the complex.
“For years, Kokomo has been at the center of our powertrain strategy and the potential of an additional investment reaffirms that position,” Chrysler CEO Sergio Marchionne said in a statement.
Political mission
For President Obama, the trip to Kokomo was part of efforts to convince the public that his $814 billion stimulus and the bailouts of General Motors Co. and Chrysler are paying economic dividends.
Chrysler came to the brink of liquidation in 2009 before a U.S. government-funded bankruptcy cut its operating costs and handed majority ownership to a union-affiliated trust fund and management control to Italy’s Fiat S.pA.
Obama wanted to make his argument in an area that benefited from the stimulus and the bailout.
“After a couple of tough years, this plant is now running at full capacity and that’s why I’m here today,” Obama said in his remarks to plant workers and reporters at the Kokomo facility.
The president “needs to show where there have been successes, and Kokomo has been one of those places,” Greg Goodnight, the city’s mayor, said. “He has to show people that we’re heading in the right direction.”
The visit to Indiana was Obama’s first domestic trip since the Nov. 2 mid-term elections, in which Democrats lost their majority in the House of Representatives to Republicans, largely on voter concern about the economy. Obama has described the outcome as a “shellacking” for his party and said many Americans viewed the bailouts and the stimulus as an “overreach” by the government.
In Indiana, Democrats lost a Senate seat and two of the five congressional districts that they held. Statewide, the Democrat’s Senate candidate, Brad Ellsworth, took 40 percent of the vote, compared with the 49.9 that Obama captured when he became the first Democratic presidential candidate to win the state in 44 years.