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Dec 18, 2008

Caterpillar to lay off more than 800 in Mossville

Caterpillar Inc., hit by a drop in demand for diesel engines, disclosed Thursday that it plans to indefinitely lay off 814 production workers at its engine assembly plant in Mossville.

The heavy-equipment giant said the layoffs will begin on Feb 23.

Caterpillar makes "big-bore" diesel engines for heavy trucks at the Mossville plant, and the company noted that demand for those engines has "decreased significantly."

Demand for engines that the plant makes for use in Caterpillar machines has also fallen off, the company said.

The weakening global economy has taken a toll on Caterpillar, which sells big-ticket equipment used in construction, mining, oil wells, seagoing ships, and a host of other activities that are sensitive to the economic cycle.

Published reports have made it clear in recent days that Caterpillar is cutting back on its use of "contract workers" who work in a variety of jobs at Caterpillar facilities, but are actually employed by outside contractors.

The Peoria Journal Star, citing sources in the United Auto Workers union, also reported this week that Caterpillar plans one-week shutdowns of three plants in East Peoria in February and again in March.

Those layoffs are temporary, in contrast to the indefinite layoffs that Caterpillar plans for the Mossville engine plant.

Separately, the governor of Texas announced late Thursday that Caterpillar will relocate to the San Antonio area engine-making operations performed in Illinois and South Carolina. The move will create about 1,400 jobs, said Gov. Rick Perry.

A Caterpillar spokesman confirmed that the engine operations are being transferred to Texas as part of a series of structural changes the company unveiled in June.

Those changes call for Caterpillar to invest $1 billion, over three years, to expand and modernize five big factories in Illinois.

The Mossville plant is one of the facilities due for the capital investment and expansion, and Caterpillar is expected to shift some operations to Mossville in the future. But as part of Caterpillar's revamping, the company indicated in June that some engine operations would go elsewhere.

It is that engine production, along with production at a plant in Greenville, S.C., that are moving to Texas, the spokesman said.

Texas said South Carolina and Mexico had also been competing for the new Caterpillar plant.

Source : ChicagoTribune
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Anonymous said...

nice post. thanks.

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