In accordance with the company’s plan to cut costs in 2016, Caterpillar starts cutting jobs as more plants close in Illinois and other states. In this restructuring plan, around 5 plants will close, costing the jobs of 700 employees in the process.
The largest workforce that will be left without a job will be from Price County, in North Central Wisconsin. 200 employees from the Prentice plant will be unemployed by the end of the year. It’s safe to say that this decision came as a rather dire news for the people who have worked at the Caterpillar manufacturing plant for almost 40 years up to this point.
Fortunately, due to the company’s recent move of upgrading the facility both externally and internally, community leader have high hopes regarding other companies’ purchase of the plant. Of course, every employee that will be laid off following the plant’s close will have a hefty severance pay added to their account, but this doesn’t mean that this move is any less saddening.
The plant itself improved the economy in the region as well as helping several communities near the facility thrive. If a new company won’t approach the idea of buying the plant, almost all workers will be forced to relocate to other regions, unfortunately.
In regards to the company itself, it has been heavily suffering the current economic markets, with market value dropping by 28% since June last year. But following the decision to cut off plants and restructure its business practices, its share values increased slightly, by 1.9%, reaching $62.24. Even if Caterpillar is slowly reaching normal levels, it is still seen as down trending by most analysts and investors.
The company is a relatively famous manufacturer of heavy-duty machinery designed for mining and construction. Engines, both diesel and natural gas, diesel-electric locomotives and industry turbines are just some of the products offered by Caterpillar on a worldwide scale. The business itself is split into several parts, each specifically tasked to manufacturing products for only one side of the industrial spectrum.
Caterpillar Resource Industries is based on constructing equipment used in mining and resource transportation, while Constructions Industries is focused on exactly what it sounds like, providing equipment for construction sites. The company has been around since 1925, when it was founded under the name of Caterpillar Tractor Co. in Peoria, Illinois.
Although Caterpillar starts cutting jobs as more plants close, the laid off employees will hopefully find new jobs in the near future. The company is hoped to fare better in the following years as well, but this entirely dependent on the state of current markets, as well as how beneficial this corporate restructuring will be.