Cummins Inc. could possibly delay breaking ground on a 100,000-square-foot information technology and digital hub in Greenwood as the company attempts to reduce costs and capital expenditures during the pandemic.
The facility, which would be located at the southeast corner of Interstate 65 and County Line Road, is estimated to bring at least 500 jobs to the city, with the possibility of up to 1,500 jobs if a second phase is built.
Company spokesman Jon Mills confirmed that the Greenwood project could possibly be delayed and expects to have more information later this week.
It is not clear when the project would break ground or if any potential delay would impact the project’s completion date or the number of jobs the facility is projected to create.
“We like the project a lot,” Cummins Chairman and CEO Tom Linebarger said Monday. “Having said that, in the context of our current environment where it’s very clear demand is going to drop precipitously this year, we’re having to look at every single project we have and make sure that we understand which ones we can delay, which ones we need to cancel, which ones we need to push ahead at the same rate, and what we decided with this one is that we are going to need to postpone the start of the project, the groundbreaking.”
The comments from Linebarger came less than two weeks after the Columbus-based company reported that first-quarter revenue fell 17% compared to the same period last year as company officials prepare for what they characterized as “a challenging second quarter” and weak levels of demand until global economies start to recover from the COVID-19 pandemic.
Cummins officials said the company will not provide any revenue or profitability projections for 2020 due to the uncertainty of the coronavirus pandemic, which company officials said they anticipate will have an “unprecedented impact on the economy.”
While some customer operations have started to resume, the company expects a “significant impact” on its second quarter results due to disruptions across customer and supplier operations and lower demand, which they project could “persist for some time.”
Greenwood Mayor Mark Myers previously called the Cummins investment in the information technology and digital hub the biggest economic development move in the city’s history. The city is giving the company incentives valued at more than $10 million, funded by taxpayers.
Myers said as of right now, there is no delay in the project. He’s still talking with Cummins to figure out what to do next, and he expects to have a more definitive answer later this week. Cummins is primarily concerned with starting the project right now with the current state of the economy, he said.
"They’re looking at what this situation is doing right now to them financially, and deciding what they’re going to do," he said. "They are still going to do the Greenwood location. We just want to make sure we know when, but we’re not there yet."
<em>The Republic reporter Andy East and Daily Journal reporter Emily Ketterer contributed to this report. </em>
