Caterpillar to cut 230 workers in East Peoria; may move Joliet parts production to Mexico

Updated Oct 9, 2015
A Cat CT681 in a dump configuration.A Cat CT681 in a dump configuration.

The first workforce cuts of Caterpillar’s recently announced, extensive cost-cutting plan will come at the company’s East Peoria, Illinois plant.

According to a report from the Peoria Journal Star, Cat will lay off 230 employees in East Peoria. The announcement came days after the company announced that it would cut as many as 10,000 jobs from its global workforce over a two-year span due to a long-standing slump in demand for mining equipment and a more recent lack of demand for equipment sold to the energy sector.

As part of that announcement, Cat said the first cuts associated with the plan would begin in the fourth quarter of this year. The East Peoria layoffs will go into effect on October 12, the company told the Journal Star.

The East Peoria cuts mark the seventh round of layoffs by the company in 2015 and the Journal Star reports the cuts bring the total number of workers laid off in East Peoria in 2015 to 500. The number of all Illinois workers cut by the company during the year is now more than 1,000.

Cat is in the midst of a third straight year of down sales and revenues and expects 2016 to mark the first fourth-consecutive down year in the company’s history. The cost-cutting plan, which also includes consolidations and closures of as many as 20 facilities, is expected to save the company $1.5 billion.

Meanwhile in Joliet, The Herald-News reports that Cat is “contemplating” cutting 20 workers from its plant there, which manufactures truck hoist and strut cylinders for the company. The cuts would end production at the plant completely and move it to Monterrey, Mexico.

“The transition of production would begin in the first quarter of 2017. Caterpillar intends to finalize this contemplated decision in the fourth quarter of 2015,” Cat spokeswoman Lisa Miller told the Herald-News in an email.

If Cat goes through with the Joliet transition, 20 workers on the truck hoist and strut cylinders line would remain at the plant but in logistical roles as the plant would be converted into a supply hub.

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Cat employs 660 workers at the Joliet facility, the majority of which are managerial staff. At one time the plant was staffed by more than 7,000 workers.