By Marilyn Odendahl, Truth Staff
modendahl@etruth.com
ELKHART -- Monaco Coach Corp. announced Monday that it plans to keep at least some jobs in the city -- a move hailed as a positive sign by a state business official.
"This is a good development," said Indiana Secretary of Commerce Nate Feltman. "Any jobs saved or gained is a good thing."
But on the same day as Monaco's announcement, Atlantis Plastics notified the state that it could be closing its three local plants and laying off nearly 200 workers.
Monaco will be retaining in Elkhart its joint chassis building venture with Navistar Inc., formerly International Truck and Engine. The partnership, operating at Custom Chassis Products, makes the bulk of the chassis for Monaco but also builds chassis and chassis-related products for other manufacturers, said Craig Wanichek, spokesman for Monaco.
About 50 employees work at the chassis operation -- a fraction of the 1,430 workers Monaco has targeted for downsizing at three local plants in September. But the payroll could climb to more than 100 in 2009, Wanichek said.
Rather than offering incentives to stay in Elkhart, the state has been discussing with Monaco the $3.2 million in tax credits the company received in 1996. Under terms of that contract, the manufacturer agreed to keep jobs in Indiana through 2015, Feltman said, and with the announced closures of facilities in Elkhart, Nappanee and Wakarusa, the company could have to repay the state.
When a company takes advantage of any kind of tax credit or economic incentive, the commerce secretary said, it has to live up to that agreement. Keeping the Elkhart plant open will lower the amount Monaco owes.
Wanichek downplayed the liability of the tax credit with swaying Monaco's decision to keep the joint venture going here. Custom Chassis is "working on a number of different opportunities," he said, and those projects were the primary reason for staying.
"We are still focused on growing and finding opportunities to continue production," Wanichek said.
The city of Elkhart plans to collaborate and start discussions with Monaco to see what can be done to help the company stay, said Arvis Dawson, executive assistant to Mayor Dick Moore.
If Monaco keeps more jobs, it would reduce the tax credit bill. However, Feltman said, after discussions with the company "it doesn't sound promising" that Monaco will be able to save other positions.
"We would rather have the jobs over even asking for one dollar back," Feltman said.
Both Monaco and Atlantis are suffering because of the downturn in the RV market. In a meeting with executives from the RV and manufactured housing industries last week, Gov. Mitch Daniels learned the state can do little to help the current situation that is being caused by high gas prices, tightening credit and declining consumer confidence.