Caterpillar, Inc. is closing its Aurora factory, near Oswego. This would make 800 of the workers unemployed, and those that are spared will be transferred to their other U.S. plants by the end of next year.
Caterpillar expects a full closure of the factory by the end of next year. Those that got lay off will get 40 hours of pay per year of service with the company. Spokeswoman Lisa Miller, said, “The company will work with community leaders to determine the future use of the facility.”
Caterpillar will likely continue maintaining an Aurora office for their product support and engineering work.
Ryan McCrady, president of the Economic Development Corp. (EDC) of Decatur and Macon County, said, “The move is a testament to the quality of employees already in Decatur and a sign that the city can supply the needed additional workers. We like to win but we’re respectful of the fact that people’s lives are impacted here. Decatur’s a great place and we’ll welcome them, and welcome the opportunity to help Caterpillar.”
McGrady said that the EDC will provide support to Caterpillar along with the Greater Decatur Chamber of Commerce, Richland Community College and Milikin University. McGrady said, “Caterpillar, without a doubt, has been a significant part of Decatur’s history. We’ll be glad to have them as a significant part of our future too.”
City Manager Tim Gleason said that there were no incentives offered to transfer jobs from Aurora to Decatur.
Miller said, “Out of about 800 production positions, about 500 positions would likely be added to Decatur and about 150 positions would be added in North Little Rock. We anticipate some will move to various suppliers and some positions would also be eliminated.”
The continued global slump in mining and construction is driving Caterpillar to rationalize its operations the past few years. In 2016, Caterpillar’s global sales dropped to $39 billion. It expects to make $38 billion this year.
Denise Johnson, Resource Industries group president, said, “Faced with lower demand, we continue to evaluate our global manufacturing capacity. Moving production from Aurora to other existing facilities allows Caterpillar to efficiently leverage manufacturing space while still preserving capacity for an upturn.”
Early in the year, Caterpillar announced that they were considering transferring the production of their large wheel loaders and compactors to Decatur. The production for medium wheel loaders is being considered to be transferred to North Little Rock Arkansas.
Johnson said, “Moving production from Aurora to other existing facilities allows Caterpillar to efficiently leverage manufacturing space while preserving capacity for an upturn. Supporting impacted employees through this transition is a top priority, as we know these actions are difficult for our talented and dedicated people.”
Caterpillar is also transferring their headquarters from Peoria to Chicago because of its strategic location. Around 300 personnel will be based in their new headquarters.
Also, Caterpillar is also planning to close their Belgium manufacturing plant which will affect 2,000 personnel. They will also be transferred to other Caterpillar plants.