Caterpillar to Eliminate 500 Jobs

Thu January 30, 2003 - National Edition

PEORIA, Ill. (AP) _ Caterpillar Inc. is eliminating about 500 jobs as part of an effort to streamline operations at several

plants, although the employees will be given the opportunity to seek positions elsewhere in the company, Caterpillar said.

The action will affect salaried and management jobs, Caterpillar spokesman Ben Cordani said Tuesday. With 70,000

workers worldwide, the cuts represent less than 1 percent of its work foce.

”This is not a mass layoff. It’s a restructuring that will impact some jobs,’ he said. ”But we plan to try and redeploy the

affected employees into other parts of the company.’

The job reduction will affect plants within the large power systems division: Mossville and Pontiac, Ill.; Lafayette, Ind.;

Griffin, Jefferson and Thomasville, Ga.; Greenville, S.C.; and Kiel, Germany.

Products from that division include engines for trucks and machines, as well as electric engines, marine engines and

engines for the petroleum industry.

Gary Stroup, vice president in the large power systems division, said ”a reduction in salaried and management

employment ... will be necessary to achieve greater synergies and operating efficiencies.’

Caterpillar doesn’t know yet how many employees from each plant will be affected or how many will be redeployed.

Caterpillar reported a 16 percent increase in fourth quarter profits last week but predicted earnings will dip slightly in

2003 because of a weak economy and rising employee benefit costs.

”The industries we are in are struggling because of the slow recovery of the economy. Caterpillar is a leader in these

industries and we are working to maintain our leadership,’ Cordani said.

Peoria-based Caterpillar is the world’s No. 1 maker of earth-moving machinery. The company designs and makes mining,

construction and agricultural machines as well as engines for earth-moving and construction equipment. It operates

manufacturing plants in 22 countries.

In morning trading Jan. 29 on the New York Stock Exchange, Caterpillar shares were down 78 cents at $43.05.