* From MarketWatch…
The move is “in the best strategic interest of the company,” Chief Executive Jim Umpleby said in a statement. The heavy-machinery maker has had a presence in Texas since the 1960s, it said.
* From comments…
It’s not like Cat had a deep history in Deerfield. It was always intended to be a stopgap location instead of leaving straight out of Peoria.
Remember, Umpleby is the first CEO who didn’t come up through the Cat ranks, he was acquired from a subsidiary and never particularly liked living in Peoria in the first place.
* Also from comments…
That right to work stuff, no state income tax, and loser pays legal fees in state court sure has some appeal to some.
* Joe Cahill…
If Pritzker thinks those manufacturing jobs are secure, he’s kidding himself. Moving a headquarters out of a state makes it easier to move factory jobs eventually; company bosses are insulated from the local fallout.
After Boeing moved to Chicago, it shifted manufacturing jobs from Seattle to South Carolina. Chicago could find itself on the wrong end of that equation this time. Caterpillar has been opening new plants in southern states, and recently moved the headquarters of one of its divisions to Texas. […]
Caterpillar’s comments on Texas were telling. The company told Bloomberg the move would improve access to talent and praised Dallas’ two airports.
That should puncture any complacency about Illinois’ assets. We pride ourselves on workforce talent and airport connections, among other things. Apparently they’re not as unique as we thought.
* Back to comments…
CAT, like Boeing, is another company that over the last 20+ years or so, profoundly lost its way.
A strong culture of ethics and engineering, gave way to anti-unionism and financialization - and resultant major business scandals.
* Leader Durkin…
The reasons for this decision could not have been more clear – Illinois’ business climate no longer works for this company.
- Levois J - Wednesday, Jun 15, 22 @ 9:41 am:
Whoever is the Republican nominee for Governor can capitalize on this.
- NotRich - Wednesday, Jun 15, 22 @ 9:44 am:
Move to a pro business State? Or stay in Illinois where a majority of the legislature wants to tax anything that moves, breathes, or exists.
- Oswego Willy - Wednesday, Jun 15, 22 @ 9:48 am:
===Move to a pro business State?===
Corporate moving and 17,000+ jobs staying here… how do you rectify that as a company leaving solely for Pro-Business?
I think IMA has this the “most right”, a well crafted statement.
What I will find most interesting come November is if the pro-labor constitutional language passes… how can one say it’s the political leadership pushing all this pro-labor stuff on “taxpayers” (we are all taxpayers)
- Anyone Remember - Wednesday, Jun 15, 22 @ 9:52 am:
===Move to a pro business State?===
Missouri qualifies (except for the pesky voters rejecting “Right to Work”). Yet corporate headquarters are fleeing St. Louis. And, despite Missouri being “pro-business” those relocations are out-of-state, not the St. Louis suburbs.
https://www.stltoday.com/business/local/so-long-st-louis-company-headquarters-that-have-moved-out/collection_eace896a-9768-58d4-90ac-21a8a869b810.html#anchor_item_37
- Oswego Willy - Wednesday, Jun 15, 22 @ 9:58 am:
Here’s the IMA take, and probably where Illinois should be going forward with CAT:
=== The Illinois Manufacturers’ Association (IMA) released the following statement regarding Caterpillar’s announcement that it will move its company headquarters out of Illinois:
“Caterpillar is and will remain a vital and important economic and philanthropic leader in Illinois. The decision to move its company headquarters out of state is a loss to Illinois, which has proudly served as home to the iconic construction equipment manufacturer for nearly a century. While 240 employees based at the company’s headquarters in Deerfield will move out of state, the company will continue to be a huge part of our state’s manufacturing sector, retaining 17,400 jobs in Illinois, and adding more every day,” said Mark Denzler, president & CEO of the Illinois Manufacturers’ Association. “We remain committed to partnering with our government leaders to ensure we keep those manufacturing jobs and put in place policies to attract and grow additional employment opportunities for communities across our state.”===
A bunch of suits leaving, leaving homes in the Deerfield area is vastly different than 100s and 100s of jobs disappearing.
Yes. It’s not great CAT corporate is leaving. I’ve yet to see anyone rationally say it’s good.
- Publius - Wednesday, Jun 15, 22 @ 10:06 am:
There are plenty of companies staying and expanding in the state but these are normally not discussed. A lot of companies don’t do a big press release about it. Someone mentioned that Cat was expanding in other parts of the state. This is more about executives wanting to be where they want to live. These executives live in Texas on the weekends and spend weekdays on the road all over the country/world.
- A Well-Regulated Commenter - Wednesday, Jun 15, 22 @ 10:07 am:
It seems Umpleby might come from the Jack Welch school of CEOs. Those strategies have been bad for lots of companies; including Boeing, GE, Kraft, etc.
https://www.axios.com/2022/05/31/jack-welchs-questionable-legacy
- Chicagonk - Wednesday, Jun 15, 22 @ 10:08 am:
CAT obviously wants to be closer to where construction is happening. No state income tax is a big help. Illinois also makes it hard for businesses to expand or build new facilities because construction costs are so high here.
- Larry Bowa Jr. - Wednesday, Jun 15, 22 @ 10:10 am:
“The company told Bloomberg the move would improve access to talent and praised Dallas’ two airports.”
We’ll see how the talent thing shakes out as the various citizen posses now enabled by Texas statute start to squeeze women and families with trans kids in that state. I realize CAT doesn’t employ many women so it may not hurt them as much but I expect that in the long run it will hurt other employers that require educated workers.
- Oswego Willy - Wednesday, Jun 15, 22 @ 10:12 am:
===Illinois also makes it hard for businesses to expand or build new facilities because construction costs are so high here.
IMA…
=== While 240 employees based at the company’s headquarters in Deerfield will move out of state, the company will continue to be a huge part of our state’s manufacturing sector, retaining 17,400 jobs in Illinois, and adding more every day,”===
“retaining and adding”
Is IMA wrong?
- Publius - Wednesday, Jun 15, 22 @ 10:13 am:
Also, I didn’t mention it but if was about corporate taxes they would move their corporates HQ out of the USA to the UK or Netherlands. You can get a good tax break and keep the vast majority of your employees in Peoria right where they are and have a couple of meetings overseas a year. Again this is just for show. Actually moving employees who do real work everyday to Texas wouldn’t happen as most wouldn’t move and you would get a large brain drain going to your competition.
- Real - Wednesday, Jun 15, 22 @ 10:18 am:
I don’t have any care for them moving to Texas. I hear of Texas having all these benefits but I doubt CAT will offer workers anything new or enhanced that they were not already providing to workers. Besides the no state income tax that Texas provides I don’t see CAT offering workers more pay.
- TheInvisibleMan - Wednesday, Jun 15, 22 @ 10:22 am:
“It was always intended to be a stopgap location”
And TX is the stopgap location on the way to full automation.
I’ll have to drown my sorrows about CAT leaving, over by the new Lion Electric and Rivian factories.
- Publius - Wednesday, Jun 15, 22 @ 10:23 am:
Based on their press release they are moving to an existing office. Caterpillar Inc. (NYSE: CAT) today announced it will move its global headquarters to the company’s existing office in Irving, Texas, from its current location in Deerfield, Illinois.
One could argue they are making the move to save on rent and be close to the CEO’s weekend residence.
- SAP - Wednesday, Jun 15, 22 @ 10:23 am:
Death by a thousand cuts begins with a single incision.
- Real - Wednesday, Jun 15, 22 @ 10:26 am:
People say Illinois needs to be more so called pro business but I rarely see big corporations that are in or moving to pro business states offering workers any type of difference than what they offered before.
- Middle Way - Wednesday, Jun 15, 22 @ 10:38 am:
They used the same statement about air access when they moved from Peoria to Deerfield. According to the latest USDOT report ORD and MDW have cheaper average fares than DFW or DAL and have almost identical total number of destinations nonstop served combined. They may have other factors that caused their decision, but Chicago’s air access not measuring up isn’t it
- Streator Curmudgeon - Wednesday, Jun 15, 22 @ 10:39 am:
During the vicious CAT strike in the 1980s, a federal judge ruled scabs could cross picket lines. That was an important ruling at the time, part of Reagan’s anti-union agenda.
In the decades since, CAT has been steadily replacing union jobs with workers from private contractors.
Downstate, everybody knew that CAT union employees had the best benefits around. Dental care, eyeglasses, high wages, and other perks.
Whether CAT will move its factories to Mexico remains to be seen–but Texas is a lot closer to Mexico for corporate execs than Illinois is.
- bogey golfer - Wednesday, Jun 15, 22 @ 11:05 am:
As a Bradley alum, there has and is a tight relationship between BU and CAT in terms of hiring and training engineers. I can’t help but wonder whether this will remain.
- Merica - Wednesday, Jun 15, 22 @ 11:23 am:
Recreational cannabis has been (for me) the best example of how this State works, or doesn’t work. It is a great example.
So you legalize recreational cannabis, which is a great idea, and you create an enormous new revenue stream. The question is what do you do with that new tax revenue?
Instead of doing something smart, like paying down State and local pensions, providing homeowners with property tax relief, or giving private businesses incentives to stay or expand, you create what is essentially a slush fund of various government spending, non-for-profit grants, and most of your recreational cannabis tax revenue disappears. The opportunity is wasted. it is sad.
- Back to the Future - Wednesday, Jun 15, 22 @ 11:47 am:
Bogey Golfer
Hear you.
I wonder about that too.
With Cat’s support Bradley has consistently been rated one of the best schools in the country for Industrial engineering and the Cat Global Communications Building on campus is very impressive.
Cat has also contributed to other central Illinois universities.
Along with losing Boeing, Marsand Wrigley, this move is a great loss for Illinois.
- Pundent - Wednesday, Jun 15, 22 @ 12:16 pm:
=According to the latest USDOT report ORD and MDW have cheaper average fares than DFW or DAL and have almost identical total number of destinations nonstop served combined.=
The folks we’re talking about here don’t fly commercial. The assumptions about what the move would mean to rank and file employees don’t translate when we talk about executives. For an apples to apples comparison you’d compare landing and hangar fees between Chicago Executive Airport in Wheeling and the local private airport nearest the Irving office. As someone else noted, the people we’re talking about here travel the world extensively. Their residence is more about where they choose to spend their weekends. The move has nothing to do with CAT’s employees or business interests it’s the personal preference of their leaders. There’s nothing inherently wrong with that. But I wouldn’t try to inscribe any specific intent to it. As Rich said, all of these things (and more) could be true.
- Da big bad wolf - Wednesday, Jun 15, 22 @ 12:33 pm:
===The opportunity is wasted. It is sad.=
Marijuana taxes go to anti crime programs and to fund the police. Do you think funding the police is bad?
https://www.bnd.com/news/politics-government/article256201817.html
- Chicagonk - Wednesday, Jun 15, 22 @ 1:10 pm:
@OW - If you don’t think construction costs and build out costs are higher in Illinois than Texas, I can send you the Corelogic reports showing the difference.
- Oswego Willy - Wednesday, Jun 15, 22 @ 1:13 pm:
===If you don’t think construction===
This is 200 plus executives leaving.
That’s what this is.
- Al - Wednesday, Jun 15, 22 @ 2:00 pm:
In the past 20 years Caterpillar has added 10 percent to their worldwide staff. However here in Illinois we have lost more than 25 percent of our Cat workers, more than 6,000. The numbers are real.
Rich will delete this in one, two, thr….
- Google Is Your Friend - Wednesday, Jun 15, 22 @ 3:19 pm:
==After Boeing moved to Chicago, it shifted manufacturing jobs from Seattle to South Carolina.==
How’s the 737 Max working out?
- Michelle Flaherty - Wednesday, Jun 15, 22 @ 3:23 pm:
Corporations make for lousy community members.
- Dotnonymous - Wednesday, Jun 15, 22 @ 5:05 pm:
“The opportunity is wasted.” - Merica
Not wasted…diverted.