GREENSBURG, Ind. (AP) – The sign in a gift shop window said it all: “Welcome Honda. Thank you for coming.”

In a city of 10,500 people, where three of four cars on the streets are American-made, officials rolled out the welcome mat for Indiana’s newest employer: Japan’s Honda Motor Co.

The automaker announced Wednesday it would build a $550 million auto assembly plant near the southeastern Indiana city, its sixth North American plant and a key piece of an $1.18 billion global expansion.

It ended a scramble by Ohio, Indiana, Michigan, Illinois and Wisconsin, which all promoted sites in their states for the plant that Honda said in May it planned for the Midwest.

Indiana had the land, the location and a fresh labor force to produce 200,000 cars a year. It also offered $141.5 million – $85.5 million in tax incentives, worker training and road and utility improvements and another $56 million for future growth.

“We believe that the great state of Indiana has what we need to continue … success: an outstanding community of people, excellent transportation systems and the necessary infrastructure to support industry,” said Koichi Kondo, president of American Honda Motor Co.

Honda and its larger rival, Toyota Motor Corp., have been rapidly expanding their North American manufacturing capacity to keep up with demand even as U.S. automakers General Motors Corp. and Ford Motor Co. are cutting thousands of jobs and closing plants as their market share declines. North America accounts for about half Honda’s annual global sales.

Honda already had a strong Midwest presence, turning out 680,000 vehicles a year at two Ohio plants. It also has an engine plant and transmissions plant there, along with 150 supplier locations in Ohio – nearly four times as many as Indiana.

“The Midwest is no longer the Rust Belt,” said Larry Jutte, senior vice president and general manager of Honda of America Manufacturing. “It’s rather vibrant now.”

Many analysts had predicted Ohio had the edge because of its history with Honda. But that might have worked against the state, Gov. Bob Taft said Wednesday.

“The large number of Honda suppliers and plants that already exist in Ohio may have resulted in our being victims of our own success,” Taft said.

Jutte said the automaker, which also has one plant each in Alabama, Canada and Mexico, did not look at state lines.

“This wasn’t a competition between states,” he said.

But Roger W. Schmenner, an industry location specialist at Indiana University’s Kelley School of Business in Indianapolis, said Indiana’s fresh labor pool likely was attractive to Honda.

Companies generally become concerned if they are the biggest employer for miles around, Schmenner said.

“They don’t want the area to become so dependent on them that the area’s economic well being is so entrusted with them.”

The plant is a big step toward reviving Indiana’s economy, which has lost 98,000 industrial jobs since 2000.

Gov. Mitch Daniels, who returned to Indiana early after an 11-day trade trip to Asia, said the Honda plant signals Indiana’s economic comeback is under way.

“This day is very special,” he said.

Susan Rust, 57, said she hopes the plant will provide jobs that keep young people in the community.

“I think it gives our children an opportunity to stay home,” she said. “There aren’t jobs for people when they grow up.”

Honda said the new plant would include stamping, welding, painting and assembly work. Engines will come from an Ohio plant 100 miles away. Kondo declined to say which vehicles would be produced but said they would be four-cylinder models.

The plant will boost the Japanese automaker’s North American production capacity from 1.4 million to 1.6 million vehicles a year and increase its employment to 37,000 in North America.

Many of those gathered for Wednesday’s announcement said the plant would transform the community about 50 miles southeast of Indianapolis.

“I think within a couple of years it will be a different kind of town,” said Will Ricke, 74, a lifelong resident of the area. “We’ll lose some of our small-town atmosphere. That could be good, that could be bad.”