The Federal Reserve’s new communication strategy was supposed to make it easier to decipher the intentions of the famously secretive institution. Markets, however, seem to have missed the memo.FORT WAYNE – General Motors Co. is considering investing $230 million to equip its Allen County truck assembly plant to make the next generation of GM pickup trucks in a few years.
Some local employees think the Roanoke site has a great shot of winning the internal competition for the project, which would preserve existing jobs rather than create new ones.
The Detroit automaker has submitted a tax abatement request to the Allen County Council for the project, which is still only a possibility, spokeswoman Stephanie Jentgen said Monday.
“These are the very initial steps,” she said.
Several GM sites – she doesn’t know how many – are vying for the upgrade. The company will decide – Jentgen doesn’t know when – based on which site makes the most attractive business case.
GM, which emerged from bankruptcy protection in July 2009, has approached local officials several times over the years to ask for incentives-laden promises before committing to an investment project.
In October 2004, company officials asked for state and local incentives before deciding whether to greenlight a $175 million upgrade. GM asked for property tax abatements worth about $4 million over 10 years. The incentive was approved – and so was the project.
Commissioner Nelson Peters on Monday said he couldn’t predict whether the latest abatement request will be approved. Andi Udris, president of the Fort Wayne-Allen County Economic Development Alliance, didn’t return messages seeking comment.
County officials have historically rewarded GM, one of the area’s largest employers. Last year, the Allen County Council and the Fort Wayne City Council each committed $1 million to GM over three years in exchange for the company’s promise to make a reasonable effort to keep the assembly plant open for the next 10 years and employ at least 2,000.
As of September, the factory employed about 3,800.
In January, the county commissioners agreed to help GM sell about 282 acres that surround the Lafayette Center Road plant. The county paid to survey the property and perform soil and wetlands studies. Those costs would be repaid after a sale. Also, the county agreed to market the four parcels.
Financial incentives offered by county, state and other sources will help GM decide where to make the proposed $230 million investment, Jentgen said.
Other factors include a successful track record for quality and safety. Having a good relationship with the local union is also a plus, she said.
“I do believe we have a very strong case,” Jentgen said. “We have a really great team out here.”
Orval Plumlee, president of the United Auto Workers Local 2209, which represents hourly workers at the plant, agreed.
“I’m thrilled,” he said of the prospects. “It would bode well for this community and the plant if we get this.”
The abatement filing says the project would “construct body shop addition necessary to support machinery, equipment and special tools to manufacture the next generation of full-size pickup trucks.”
Plumlee and Jentgen declined to reveal specifics of the proposal, but Plumlee said it includes a plant expansion of “considerable size.”
Adding floor space would help the operation be more competitive when it bids on future GM work, he said.
In the short term, local construction crews would keep busy with another major project just as the Parkview Regional Medical Center and Lutheran Hospital fifth-floor addition projects are scheduled to wrap up, Plumlee said.
The union leader believes the plant has a great chance of winning the work, partly due to the quality of work. Motor Trend magazine last week named the 2011 Silverado HD the heavy-duty truck of the year. Two-thirds of GM’s total production of the vehicle is at the Allen County plant. The other third is made in Flint, Mich.
“We’re taking bragging rights on that,” Plumlee said.
Even so, the local assembly plant’s performance has sputtered in recent weeks. Plumlee said the extended-cab trucks with two rear wheels on each side weigh 1,800 pounds more than any other vehicle that travels down the production line.
That additional ton has “been very taxing on some of the components,” he said. “Some components need to be replaced.”
That will happen during the plant’s annual Christmas shutdown, which is being extended to three weeks this year from one week for the necessary updates.
Plumlee said production equipment needs preventive maintenance just as a vehicle does.
“I don’t find it alarming or disheartening or an area of concern,” he said.
Plumlee is optimistic that maintenance issues will join the bankruptcy as a temporary setback.
“GM is back,” he said.
Paul Wyche of The Journal Gazette contributed to this story.
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