Indiana Ponders $35 Million Cummins Loan

A $35 million measure aimed at saving some 500 jobs at Cummins Inc. (CUM) is to be considered by a conference committee in the Indiana General Assembly.

The measure, which would provide loan guarantees for development of medium duty truck-engine technology, has the support of Governor Frank O'Bannon, and was approved by the House of Representatives on April 13, the Indianapolis Star reported.

The Columbus, Ind.-based diesel engine maker reported first-quarter losses of $26 million on April 12, compared with $42 million profit in the first quarter of 2000.

Cummins made the loan request public Wednesday, triggering opposition from some state lawmakers who noted that the $35 million sought is comparable to the $38 million Indiana con-tributed as its share of the multistate bailout of Chrysler Corp. in 1980.

John Stark, publisher of Stark’s Truck and Off Road Ledger, told Transport Topics it would be used to develop Cummins’ capability to build medium duty engines, needed after plans for joint projects on medium duty engines with Paccar and Navistar International fell through.

Neither company would discuss the existence of any joint medium-duty project with Cummins. Navistar spokesman Roy Wiley told Transport Topics the Chicago-based company has a long-standing policy of never commenting on speculation.

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