Caterpillar Inc. will close two manufacturing plants and a distribution center in Illinois, eliminating about 170 jobs.
The work from the Anchor Coupling subsidiary facilities, two in Sterling and one in Dixon, Ill., will be shifted to an Anchor Coupling facility in Menominee, Mich. The division manufactures hydraulic hose assemblies for Caterpillar machines, and for other original equipment manufacturers.
The global mining manufacturer, which is based in Peoria, Ill. and has been struggling through a mining industry downturn, said the decision was made to reduce costs, drive efficiency and use existing assets. Caterpillar’s world mining division is based in Oak Creek, and the company operates a production plant in South Milwaukee.
Caterpillar said the transition will be completed in the first quarter of 2015.
“We recognize that this decision will be difficult for our employees,” said Greg Folley, vice president with responsibility for Caterpillar’s remanufacturing, components and work tools division. “We value and appreciate the work that our Sterling and Dixon employees have contributed and their dedication to producing and distributing quality products. This decision is not about the performance of these plants, but rather about improving efficiency across the component manufacturing footprint and reducing the cost structure driven by three independent facilities, while providing the highest quality products to our customers.”
Caterpillar reported first quarter net income of $933 million, or $1.44 per share, up from $880 million, or $1.31 per share, in the first quarter of 2013. The company laid off 60 production employees at its South Milwaukee plant in April.
