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200 local Caterpillar workers facing layoffs : News : Oswego Ledger-Sentinel : Hometown Newspaper for Oswego and Montgomery, Illinois
200 local Caterpillar workers facing layoffs
Firm shifting excavator manufacturing operations to Texas plant

by Matt Schury

12/12/2013

Some time this month the final hydraulic excavator will roll off the assembly line at the Caterpillar plant near Montgomery and with it will go about 200 union jobs.

The construction manufacturing facility in Oswego Township on Route 31 will no longer make the heavy equipment as Caterpillar finishes shifting production of the excavators to a newly built 600,000-square-foot plant in Victoria, Texas.

The news of the layoffs was given to the United Auto Workers Union 145 in October and should take effect some time this month, union president Mark Patton said last week.

The union has about 1,100 workers at the plant. The layoffs will include 195 hourly workers and 30 support and management employees.

Patton said that the timing of the layoffs is not lost on him.

"It really sucks right now before the holiday," he said. "I don't know if there is ever a great time to lose 200 jobs but it really sucks at this time."

The state of Illinois requires Cat to notify the union 60 days before the layoffs are to occur but Patton said as of last week he hadn't heard of anyone at the plant given their pink slip yet.

"Because they have already given their required warrant notice now it is up to them," he said.

While Patton says he understands that Cat had to cut jobs because their production hasn't been high since the recession in 2008, this round of layoffs comes as a direct result of the company choosing to move production.

"I'm sure the economy doesn't help the rest of our business but the excavators leaving was the company's decision," he said.

Rachel Potts, a spokesperson for Caterpillar, said the company has been planning the transition since 2010.

"I certainly understand that doesn't make it any easier but it is something that has been talked about," she said.

In a statement from Potts, Caterpillar said, "We know this is difficult for our employees and their families, and the company will do what it can to ensure impacted employees have support during this time."

In 2010 Caterpillar said it was moving production to Texas because it made strategic sense.

"Based on our comprehensive review of possible locations, Victoria's proximity to our supply base, access to ports and other transportation, as well as the positive business climate in Texas made this the ideal site for this project," Gary Stampanato, Caterpillar vice president with responsibility for excavators said three years ago.

The company said at the time that it produces two excavator models in Aurora in addition to wheel loaders, soil and landfill compactors, wheel dozers and components.

Caterpillar also produces excavators in Belgium, Brazil, China, France, Indonesia, Japan and Russia

Cat said the new facility in Texas will manufacture the two models now made at the plant near Montgomery, as well as several additional excavator models now produced in Akashi, Japan, and exported to the United States, according to the statement from 2010.

The expansion of excavator production in the U.S. will allow the Caterpillar facility in Japan to better serve the growing demand for excavators in Asia. Caterpillar has also announced plans in 2010 to quadruple excavator capacity at its manufacturing facility in Xuzhou, China, primarily in support of growing demand in the Chinese market, the company said.

John Sterrett, Kendall County's Economic Development coordinator, said that one reason a company like Cat may be leaving Illinois is the state's unsure finances.

"I think there is some uncertainty out there for some businesses and that's not good for them ... they want to be able to know that if things aren't great right now, they are going to improve," Sterrett said.

He added that saying a business climate is better in one state than another is rather subjective.

"As far as better climate goes I think it depends on what category you're looking at," he said.

Sterrett maintained that Illinois still has a strong skilled work force that will continue to attract businesses.

"One of the best assets in the Midwest and the Chicago area is our skilled labor force," he said. "I think you'd be hard pressed to find it in other areas."

The Caterpillar plant has been in Kendall County since 1957 and at its peak employed about 6,000 workers. The last major round of layoffs at the plant came in February of 2009 when the construction equipment manufacturer laid off 500 workers.




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