Caterpillar to close plant near Aurora, lay off 800 workers

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The Caterpillar headquarters in Montgomery. Daily Herald Photo by Rick
West.

Caterpillar Inc.said Friday it is closing its Aurora plant and laying off 800 workers.

Since January, the company has been considering moving the machine production out of its Aurora facility into other manufacturing facilities in the United States.

“Moving production from Aurora to other existing facilities allows Caterpillar to efficiently leverage manufacturing space while still preserving capacity for an upturn,” said Denise Johnson, Caterpillar group president of resource industries.

Caterpillar will transition its prime products made nearAurora to other plants by the end of 2018. Large wheel loaders and compactors will move to Downstate Decatur, and medium wheel loaders to North Little Rock, Arkansas.

“This decision will impact about 800 hourly production employees in Aurora. Any impacted employee can apply for open positions at other Caterpillar facilities,” said spokeswoman Lisa Miller.

Although the manufacturing will move out of the plant near Aurora, the company does plan to maintain an office there for engineering and product support, the company said in a release. About 2,000 people currently work in the Aurora plant.

The company, the world’s largest manufacturer of earth-moving equipment, has said that it faces lower demand and has evaluated its global manufacturing capacity.

Caterpillar’s global sales and revenue slumped in 2016 to an estimated $39 billion, and the company has called for similar figures this year, with $38 billion as a “reasonable” midpoint for sales and revenue.

Caterpillar Inc. also said two months ago that it is moving its headquarters from Peoria to the Chicago area. The company has not revealed where it will go.

The move of the headquarters comes as the company faces a weak equipment market that has been cutting into its bottom line.

Caterpillar said it will locate a limited group of senior executives and support functions in the Chicago area later this year, saying it is a more strategic location. The company expects about 300 people to be based at the new location.

Caterpillar said the vast majority of its people will remain in central Illinois. The current Caterpillar building in Peoria will continue to be used.

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