Cat announces more job cuts, plant closures
- Details
- Published on Thursday, 28 April 2016 15:46
- Written by Paul Gordon
Caterpillar Inc. announced today it will close five facilities in the south and eliminate about 820 positions in the next year to 18 months.
The company also plans to demolish one of its large vacant buildings in Mossville to save on maintenance costs as it continues to restructure and reduce costs in what it calls “tough market conditions” that have harmed its sales and profitability.
The cuts announced today are part of the restructuring first announced last September and will bring to about 5,300 the number of jobs that have been cut since that time and to 20 the number of facilities to be closed. Caterpillar said the closures represent about 7 percent of its total square footage around the world.
“Caterpillar continues to take costs out of its business to align with lower demand as part of an aggressive and significant restructuring initiative first announced in September 2015. These actions are resulting in substantial cost reduction for the company in these tough market conditions,” the company said in a statement.
“These decisions enable the company to be more efficient and better utilize its manufacturing assets,” it said.
The announcements include:
- Production of buckets and other work tool attachments for the medium wheel loader product line in the Jacksonville, Florida, facility will move to existing suppliers. The Jacksonville facility is expected to close by year-end 2016, impacting about 70 positions.
- Caterpillar will close the Morganton, North Carolina, facility where it manufactures engine and undercarriage components. Some production will shift to other Caterpillar facilities. The rest will transition to outside suppliers. This closure impacts about 110 positions. Production is expected to continue into 2017. The final transition for the consolidation is expected to be completed within the next 12-18 months.
- On Caterpillar’s Mossville, Illinois, campus, it will demolish Building BB. The building, which used to house engine manufacturing, has been mostly vacant since 2011, and therefore, employment will not be impacted. Preparations will begin this spring, with demolition beginning later this year. Demolition will result in a net cost savings for Caterpillar, as the company will eliminate the ongoing maintenance and operating costs of the structure.
- The company will consolidate two facilities in South Carolina that are part of its generator set business into existing Caterpillar engine facilities throughout the United States. The facilities that will close are the electric power generator set packaging facility in Newberry, South Carolina, and the generator set control panel assembly facility in Ridgeway, South Carolina. This will result in a reduction of about 325 positions in Newberry and about 75 in Ridgeway. The work will be consolidated into existing Caterpillar engine facilities in Seguin, Texas, Lafayette, Indiana, and Griffin, Georgia. This transition is expected to begin this year and be completed in the next 12-18 months.
- In Oxford, Mississippi, the company will close its facility that produces hose couplings and move some operations into Caterpillar’s Menominee, Michigan, facility. The remainder of operations will be transitioned to suppliers. The closure will impact around 240 positions. Production is expected to continue into 2017. The final transition for the consolidation is expected to be completed within the next 12-18 months.
“Caterpillar recognizes these restructuring actions are painful for its dedicated workforce, their families and the impacted communities. The decisions are difficult; however, it is necessary to have the right capacity in place for the tough market conditions the company is facing,” the company said.
