Heavy equipment maker Caterpillar said Friday it plans to close five factories, including one in Georgia, as part of a broader downsizing that follows a brutal 2015 for the company.
The Illinois-based maker of bulldozers and mining equipment said it will eliminate a total of about 670 jobs as part of the restructuring. The closure include a fuel systems manufacturing plant in Thomasville, about 250 miles south of Atlanta, and four other plants in the U.S. and China. Corporate jobs in Illinois also are affected.
The closure of the Thomasville plant will eliminate about 200 jobs, the company said in a statement. A facility in LaGrange will be the beneficiary of some operations consolidations from Wisconsin, but no new jobs are expected to be created as part of that shift, the company said.
“Caterpillar recognizes these restructuring actions are painful for its dedicated workforce, their families and the impacted communities,” the company said in a statement. “The decisions are difficult, however, it is necessary to have the right capacity in place for the tough market conditions the company is facing.”
Caterpillar took a beating in 2015 amid a turbulent global economy and a slowdown in developing nations like China and Brazil. Many of the segments that Caterpillar specializes in — including mining and energy — slumped as a result of falling commodity prices.
Caterpillar said on Thursday its sales revenue was $47.01 billion in 2015, down 15 percent from 2014.
“The outlook for 2016 sales and revenues does not anticipate improvement in world economic growth or commodity prices,” Caterpillar said in its Thursday earnings release. Much of that pain will continue to be in the oil and gas sectors, the company said, as it forecasts continued low fuel prices. Caterpillar said its construction industries segment is expected to decline 5 percent to 10 percent next year.
The manufacturing sector overall is showing signs of contracting.
Durable goods orders — things like aircraft and heavy machinery — were down 3.5 percent for 2015, with orders declining in four of the final five months of the year, according to data from the U.S. Commerce Department.
“In the United States, improving labor market conditions and relatively stable economic growth should continue to support the wider economy and construction,” Caterpillar said in its 2016 outlook. “However, we expect weakness in developing countries and lower activity in oil-producing regions to persist.”
In February 2012, Caterpillar announced plans to hire 1,400 workers through 2020 at a new factory in Athens. That facility was not included in Friday’s announcement.