Caterpillar Bringing Surface Mining & Technology Facility to Arizona; Jobs Shifting from South Milwaukee

Disappointing, albeit not surprising, news from Caterpillar today …

This morning, the company announced to employees a decision to centralize its Surface Mining & Technology Division in Tucson, Ariz. The move “is the result of a comprehensive study to place our footprint closer to customers and proving grounds, drive a deeply collaborative culture between employees, dealers and customers, and create strong mining-focused career pipelines,” the company tells me.

The transition will occur over the next five to seven years, and does not impact Cat’s approximately 250,000 square-foot manufacturing footprint in South Milwaukee — one that continues to undergo upgrades with millions of dollars of new equipment and other investment, according to our local spokesman, who said the goal remains to make South Milwaukee a “world-class” maker of rope shovels and draglines.

(Last year, you’ll recall Cat announced it was shrinking by half its local manufacturing footprint, closing two buildings while investing in what remains.)

The opening of the new Tucson facility will result in some management roles moving from South Milwaukee and other locations around the country to the Tucson area over time. This year, about 10-15 employees from South Milwaukee will move. Longer term, more of Cat’s engineering and support positions will transition, although key operations support will remain. The bulk of the local moves will occur closer to 2018.

All in, a Cat spokesman tells me South Milwaukee could lose about 200 jobs to Arizona, including some that had been located in Oak Creek before Cat announced last year it was closing that facility and moving those workers to South Milwaukee

Cat has about 800 active local employees today, including about 600 in salaried and management positions.

Please keep the families of the impacted workers in your thoughts and prayers. These types of transitions are never easy.

While this news is disappointing, I am not discouraged. We will continue to push, undeterred, forward. We have to.

Tonight is a big night on that journey, as the council considers final passage of our comprehensive plan update and downtown plan — one that begins to ponder a smaller Caterpillar — as well as an enhanced downtown small business incentive program and additional funding to bring the top priorities of the plan to life for South Milwaukee.

We have strong economic redevelopment momentum in our city. We will build on that and work harder than ever to deliver on the promise of our promising future.

The case to do so has never been stronger, especially with today’s news.

Here is early newspaper coverage from Tucscon. Here is a Milwaukee Journal Sentinel story, with this comment from former Bucyrus CEO Tim Sullivan: “This is truly a very sad day for Milwaukee and Wisconsin as these jobs have existed in the region for 136 years.”

2 Comments

Filed under South Milwaukee

2 responses to “Caterpillar Bringing Surface Mining & Technology Facility to Arizona; Jobs Shifting from South Milwaukee

  1. D.M.

    Just tell them to go. This has dragged out like a bad relationship long enough. Cat had no intention of being a good community member from day one. It was always about getting thier hands on the bucyrus acquisition of terex. Government said they couldnt buy terex but allowed them to take over bucyrus, in my opinion had alot to do with Bucyrus’ support of John McCain during the election of ’08.

  2. Joe F.

    If I remember right, about 6 – 7 years ago Bucyrus threatened to move their facilities to another state/country due to the age of their existing facilities. But South Milwaukee stepped up and offered tax incentives and financing for refurbishing the facilities, and for keeping the jobs here in South Milwaukee.

    Then shortly after the refurbs were completed, Bucyrus sells off to Cat, and then the jobs start disappearing. I feel like South Milwaukee got cheated, and Bucyrus acted in bad faith.

    Wasn’t there any controls on the tax breaks/financing that guaranteed jobs stay in South Milwaukee, or else tax breaks would be rescinded and fines imposed?

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