Talgo Inc., the Spanish train manufacturer, will close its Milwaukee manufacturing operations in 2012, since the federal government has announced that it is cancelling the Milwaukee to Madison high speed rail project. Most of the $810 million in federal funding has been transferred to rail projects in other states, because of Governor-elect Scott Walker’s opposition to the project.
Wisconsin and the state of Oregon have each purchased two train sets from Talgo. The company established a manufacturing and maintenance facility earlier this year in the former A.O. Smith and Tower Automotive facility at 3533 N. 27th Street.
Talgo now has about 40 employees in Milwaukee. Employment will peak at about 125 workers, said Nora Friend, Talgo spokesperson.
Talgo was counting on Wisconsin to order an additional two train sets to serve the Milwaukee-to-Madison line. Now that the project has been cancelled, Talgo has no choice but to end its production in Milwaukee once its work on the four train sets for Wisconsin and Oregon is complete in 2012.
“We will not be able to continue our production in Milwaukee after 2012,” Friend said. “It’s heartbreaking to us to be ramping up only to know that we will have to wind it down in 2012.”
Talgo had hoped to build trains for other states at the Milwaukee plant, Friend said. However, since the Milwaukee-to-Madison project has been cancelled, there will be a major production gap for the company that will force it to end production in Milwaukee, she said.
“We can’t run a manufacturing operation if we don’t have anything to build,” she said. “But, our commitment with vendors and our employees for the existing production of the four train sets being built in Milwaukee at this time will continue uninterrupted through spring of 2012.”
The company hoped its Milwaukee operation was just the beginning of a major manufacturing operation to build high-speed trains for the entire United States, Friend said. The cancellation of the Milwaukee-to-Madison high-speed rail project is a lost opportunity for major expansion of the Talgo Milwaukee operation and will hurt vendors in the area that are supplying the plant, she said.
“What Wisconsin is losing is the growth of an industry,” Friend said. “It’s huge. It’s a big loss.”
About 60 employees will work at the maintenance facility, probably including some who are working at the manufacturing plant. A location has not been selected for the maintenance operation, but it will most likely be at Talgo’s current location at the former Tower Automotive complex, Friend said.
