Caterpillar cutting costs (and jobs)

August 27, 2015 12:50 PM

Heavy machinery manufacturer Caterpillar Inc said it plans a new round of layoffs to cut costs as declining revenues from global mining and construction activities erodes its bottom line.

The Peoria, Illinois-based company said it notified workers earlier this week it will reduce staff in its customer services support division by cutting 475 jobs. The move comes after the company previously announced about 270 layoffs for Illinois employees.

"The restructuring is a result of a consolidation of several divisions combined with current business conditions," spokeswoman Lisa Miller said in a written statement.

Caterpillar has let go about 4,800 employees over the past year and has cut 20,000 full-time employees worldwide since 2012, more than 10% of its global workforce.

The most recent layoffs will primarily effect employees at facilities around central Illinois, including Peoria and Morton, but will also include some global positions, Miller said.

The positions were responsible for supporting after-market parts and service and handling customer and dealer support, Miller said.

The layoffs are expected to take effect on various dates and some may not be effective for several months. The impacted workers are office personnel and are not union-represented employees.

In July, the company reported a drop in quarterly profit due to an expected decline in construction revenue on reduced residential building activity in China and Brazil, soft sales related to oil and gas construction in the United States and the strong U.S. dollar undercutting the value of sales in Europe.

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