GM hedges on expanding Allison plant

Economic conditions may delay doubling of factory in 2004

Depends on market

Note of uncertainty on the day officials dedicate facility

March 31, 2001|By Ted Shelsby | Ted Shelsby,SUN STAFF

General Motors Corp., which is celebrating the opening of its big Allison truck automatic transmission plant in White Marsh, is beginning to hedge on plans for an expansion that would double the size of the facility and add another 390 jobs.

Lawrence E. Dewey, president of Allison Transmission, said yesterday that the company is now "looking at production capacity and customer demand" in determining its decision on future expansion at White Marsh.

"We've said all along that this is tied to market development," Dewey said during an interview at the plant dedication ceremony with state officials.

At least some of the officials attending yesterday's ceremony did not remember it that way.

"We thought it was a done deal," Rep. Benjamin L. Cardin said. "But I'm not worried. The expansion is not going to go anywhere else," the Baltimore area Democrat said.

Sen. Barbara A. Mikulski, who played a role in the state's initial efforts to lure Allison to Maryland, said the company's original plan was to expand the factory in 2002. She said this later was pushed back to 2004.

"They were planning to do that," the Maryland Democrat said. "We took them at their word. We saw it as a firm commitment."

Mikulski was not at yesterday's plant dedication.

Dewey did not say the expansion would be canceled. Allison serves more than 200 original equipment manufacturers around the world, and any expansion at White Marsh will be linked to the business volume of these customers, he said.

In December, after his visit to Detroit to meet with General Motors officials, Gov. Parris N. Glendening said that GM gave him a letter committing to the Allison plant's expansion.

Michael Morrill, a spokesman for the governor, said yesterday that the letter contained a clause linking the expansion to market conditions, but GM "indicated at the time that they had every intention of expanding the plant."

The state and Baltimore County have earmarked $3.2 million in incentives to help finance the Allison expansion.

David S. Iannucci, Maryland's secretary of business and economic development, said the company would not benefit from the financial package until it invests nearly $200 million and hires 390 workers.

According to Allison, the state and Baltimore County contributed about $14 million to help finance the White Marsh plant.

GM invested $202 million

GM invested $202 million in building the first phase of the 400,000-square foot plant.

The plant currently employs 350, most of whom were transferred from GM's van assembly plant on Broening Highway in Southeast Baltimore. Another 100 workers are scheduled join the plant this summer.

The Allison plant is still gearing up to meet its goal of producing 140,000 transmissions a year.

These are used in light commercial trucks, which includes GM's Chevrolet Silverado and GMC Sierra pickup trucks, shuttle buses, motor homes, and a wide variety of work trucks.

Most from city plant

The company has said the 400,000-square-foot expansion would cost $199 million and employ another 390 workers. Most of them would be transferred from the Baltimore van plant.

As part of its grand opening ceremony, Allison is opening its doors to the general public for plant tours from 11 a.m. to 3 p.m. today.

The plant assembled its first truck transmission over the weekend of Dec. 2-3.

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