Marion contractor becomes Getrag's first casualty

ken.delabastide@kokomotribune.com

The Getrag Transmission LLC bankruptcy, which resulted from the failed joint venture with Chrysler LLC in Tipton County, has forced a central Indiana contracting business to close its doors.

Moorehead Electric, headquartered in Marion, was forced out of business this week after 75 years in operation.

"We're going out of business," said Jerry Albrecht, president of the company. "It is totally because of Getrag."

Albrecht said the Marion company is owed more than $9.5 million for work done at the Getrag facility in Tipton County. The closing of the business will put 100 people out of work.

In 2007, Chrysler and Getrag Transmission LLC announced construction of a $530 million plant in Tipton County that would employ 1,200 people. Last year, Chrysler filed a lawsuit against Getrag alleging the German manufacturer could not secure the necessary financing to complete the project.

In early April, Indiana Secretary of State Todd Rokita filed a complaint against Chrysler for alleged securities fraud. The complaint alleges Tipton County sold $5.5 million in bonds to Chrysler a day before the company filed the lawsuit against Getrag.

The deadline for Chrysler to respond to the complaint has been moved to May 5 and a hearing is set for June 24.

Last November, Getrag Transmission LLC filed for bankruptcy protection and halted construction. Contractors are owed more than $44 million for work at the plant.

Albrecht said the vendors, bank and bonding company didn't want to continue to support the business.

"We were not capable of going after new work," Albrecht said. "We ran out of capital."

Albrecht said work the company was doing has been turned over to other contractors.

Because Moorehead Electric was a medium-sized company, it did receive a little attention from state officials, but not enough to save the business.

Albrecht said Gov. Mitch Daniels and lawmakers tried to do everything they could, but nothing came of it.

"The Indiana Economic Development Corp. couldn't or wouldn't do anything," he said. "If we were a new company moving to Indiana and bringing 100 jobs, they would have turned all kinds of flips to help us."

Albrecht said even if the state offered to help the contractors now, it is too late for his company.

"It was the worst decision I've ever had to make," he said of closing the business. "The only hope I have is that [Getrag] make us right. I could re-capitalize again and start up a new business."

Albrecht said the company was forced to give up $4 million in work.

"The bank decided to pull the plug," he said of what led to the closing of the business.

"I'm disappointed," Albrecht said of how the Getrag and Chrysler alliance fell apart. "They closed a fine company because of immoral and dishonest practices."

Jim Miller, with BMD Contractors in Kokomo, said he was disappointed lawmakers failed to help the Getrag contractors. BMD Contractors is owed $3.1 million.

"At this point, I'm only optimistic that something will happen in Tipton County as a result of the Chrysler-Fiat alliance," he said. "That's about the only optimism I have."

Miller said the company owes money to vendors as a result of the Getrag contract, but the banks are unwilling to extend credit.

If the state would help the contractors' ability to be bonded for future work, that would help, he said.

"A problem is there is no work in the area," Miller said. "We have to go to Lafayette or Indianapolis. Right now, we're trying to bid work with general contractors that would provide the bonding."

He said a number of contractors are bidding on all the available work and the price is going down.

"I'm optimistic something can come out of the Tipton facility," Miller said.