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Carrier says it has struck a deal with Trump to keep nearly 1,000 jobs in Indiana

President-elect Donald Trump and Carrier have reached a deal that will keep nearly 1,000 factory jobs in Indiana, the company said on Tuesday.

Carrier poses an early critical test for Trump, who promised during the campaign to keep American jobs from fleeing to Mexico.

The company, which is owned by defense contractors United Technologies, announced in February that it would close two Indiana plants — a Carrier plant in Indianapolis that employs 1,400 workers and a United Technologies Electronic Controls plant in nearby Huntington, Indiana, that employs 700.

The company planned to send that work to Mexico starting next year, a move that would have saved it $65 million a year in labor costs, according to the union that represents the workers.

United Technologies is a leading defense contractor that benefits from billions of dollars in federal spending, so it needs to maintain good relations with the incoming Trump administration.

United Technologies collects about $5.6 billion in annual revenue from U.S. government contracts, according to company filings, which is equal to about 10% of its overall revenue.