Navistar International plans to close its Melrose Park, Ill., operation and sell the location to a developer. The engine and truck builder will reassign half the workforce there (reported to be 250 employees) as a result, -- meaning 250 workers will be laid off as a result of the sale.
The value of the sale was not announced, but Navistar noted the unnamed developer has a plan to redevelop the property. The sale and closure will cost Navistar approximately $85 million it said, including approximately $40 million in cash.
"Given changes at Navistar and in the industry, it no longer makes sense to maintain a facility of that size," stated Phil Christman, president of operations for Navistar. "Further investment in the Melrose Park property would divert substantial resources away from investments in new technologies and products."
The Melrose Park plant ceased building Navistar N-Series engines in 2018, and the manufacturer laid off 170 workers at that time. The plant has continued to function as an engine testing and technical center.
Last August, Navistar extended a supply agreement with Cummins Inc. through 2026 for medium-duty and heavy-duty big bore engines, to be installed in International Trucks and IC Buses in the U.S. and Canada.
Most notable, Navistar has accepted a $3.7-billion takeover bid by Volkswagen AG’s commercial-truck subsidiary, Traton.
