By Boris Ladwig, The Republic City Editor
Chrysler LLC has canceled its contract for the Cummins Inc. light-duty diesel engines expected to be built at Plant 1.
However, a Cummins spokesman said that Chrysler has not told Cummins that it has canceled the project and that the companies are renegotiating the terms because the economy has changed drastically since the project was announced in 2006.
At the time, Cummins expected to invest $250 million in the former heavy-duty assembly plant and create between 600 and 800 jobs.
"We expected them to do this," said Mark Land, executive director of corporate communications.
Cummins has been preparing Plant 1 for the launch of the engine, which is to power Dodge Ram 1500 pickup trucks. Cummins also exclusively produces a midrange engine for the 2500 and 3500 Ram models at its Walesboro plant, which has been idled due to Chrysler's bankruptcy.
Chief Executive Officer Tim Solso said at the annual meeting May 12 that Cummins still expected light-duty diesel engines to power vehicles in North America.
Cummins executives have said Chrysler's bankruptcy had significantly delayed the project, which initially was to have been launched by the end of the decade.
"It's pretty difficult to think that would happen," Land said Thursday.
"The program is still delayed," Land said. "It is not scrapped."
He said he did not know when Cummins would launch the project or how many engines would be produced, but he said Cummins still believes that a light-duty diesel engine will power Dodge Ram pickup trucks.