Auto industry bailout pulls Kokomo back from brink | Deseret News
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By Charles Wilson Associated Press Published: Monday, Nov. 22 2010 2:36 p.m. MST 0
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Summary Jerry Price remembers the eerie silence less than two years ago when he walked through one of the transmission plants that long provided the economic lifeblood of this town steeped in auto industry history.
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Auto industry bailout pulls Kokomo back from brink
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KOKOMO, Ind. — Jerry Price remembers the eerie silence less than two years ago when he walked through one of the transmission plants that long provided the economic lifeblood of this town steeped in auto industry history.
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With the machines still and the workers gone, casualties of Chrysler's bankruptcy declaration a few days earlier, the only signs of life were a few lights that had been left on. "None of us, including myself, ever thought that this place would be running again," said Price, vice president of United Auto Workers Local 685. Not only has the plant reopened for business, but President Barack Obama and Vice President Joe Biden are visiting Tuesday to herald Kokomo as one of the major success stories of the auto bailout. Residents of this city, where unemployment once soared above 20 percent after the shutdown, are doing their part to proclaim the virtues of legislation that generated plenty of controversy at the time. "If the bailout hadn't come, then we'd be a ghost town," said Jeff Newton, a pastor who runs Kokomo Urban Outreach, which runs a network of food pantries. Kokomo's fortunes have been entwined with the auto industry since 1894, when Elwood Haynes invented one of the first automobiles in the United States there. Since the 1930s, when then-Delco (later Delphi) located there, followed by General Motors and Chrysler, the auto industry has been the city's bread and butter. Today, Kokomo is likely more dependent on the industry than any other city in the country — including those in Michigan, said Indiana University-Kokomo Chancellor Michael Harris, an economist who has studied the auto industry for 20 years. Nearly 25 percent of the city's work force is employed by
http://www.deseretnews.com/article/700084585/Auto-industry-bailout-pulls-Kokomo-back-from-brink.html?pg=1[3/27/2015 8:21:25 PM]
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Auto industry bailout pulls Kokomo back from brink | Deseret News
the industry, he said. Most work at the four Chrysler plants that employ about 4,500 today, at GM, which employs about 1,000, or at Delphi, which has about 1,400 workers.
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"If the auto industry would have totally walked away from Kokomo, we would probably have unemployment that would have hit 35 percent," said Harris. As it was, the city's unemployment rate hit 20.4 percent in June 2009, the highest level in the past decade. "It's been very scary at times," said Dave White, 58, who has worked at Chrysler for 24 years. His wife also works for the automaker. Kokomo leaders and business owners say an infusion of cash pulled the city back from the brink. Besides benefitting from Chrysler's $7.1 billion share of the auto industry bailout, the plant received nearly $4 million in federal stimulus money and an $89 million grant to help Delphi Automotive Systems develop electronic components for vehicles.
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In September, the jobless rate dropped to 12.7 percent — the lowest rate in nearly two years. Stimulus money paid for a new park pavilion and helped remodel a fire station. Democratic Mayor Greg Goodnight said the city used other money to remove 11 stoplights and convert several streets into one-way streets to help make downtown more friendly for pedestrians. Volunteers also planted flowers throughout downtown to spruce up the area. While those jobs were temporary, observers say the bigger — and longer lasting — boost has come from Chrysler and Delphi, which have invested heavily in Kokomo since receiving federal help. Delphi announced a $28 million investment and Chrysler has promised more than $300 million to retool one of its transmission plants. "There's no doubt that Chrysler has decided to make Kokomo the center of their manufacturing for the future," Harris said. Even so, Kokomo's recovery is still in its infancy. Page: 1 2
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http://www.deseretnews.com/article/700084585/Auto-industry-bailout-pulls-Kokomo-back-from-brink.html?pg=1[3/27/2015 8:21:25 PM]
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