Caterpillar to close plant in West Virginia
The global mining slowdown continues to be felt by mining equipment suppliers. Caterpillar, the world’s biggest maker of mining equipment, announced plans to shutter a plant in West Virginia to curb costs as demand drops for machines used to dig up coal and copper.
Production of highwall miners used in underground mines will move to Pennsylvania from Beckley, WV, by the middle of 2014, Caterpillar said today in a statement emailed to Bloomberg.
The closing is among a half dozen announced in the past year by Caterpillar as it copes with its first drop in sales and profit since 2009. Others include a Summerville, SC, plant that does re-manufacturing work for the auto industry, a tunneling business near Toronto and a facility that makes jumbo shaft drills in Sudbury, Canada, Rachel Potts, a company spokeswoman, said in an email to Bloomberg.
A limited number of engineers among the 40 workers to be affected by the latest closing may be retained and moved to the Pennsylvania plant, Barbara Cox, a spokeswoman for Peoria, Illinois-based Caterpillar, said. Caterpillar also will offer a severance package, according to the statement.
The Beckley plant and the factory in Kilgore, Texas, that makes dippers and ballast boxes, which Caterpillar announced earlier would also be closed, will be put up for sale.
The biggest hit to demand is coming from mining. Analysts on average expect capital spending plans for major mining companies to fall 16 percent in 2013 and as much as 12 percent in the next two years, Karen Ubelhart, an analyst at Bloomberg Industries, wrote in a report on Oct. 15