Caterpillar set to lay off 2,000 workers in Belgium

Caterpillar said Friday it is considering closing its plant in Belgium and making 2,000 workers redundant as the US heavy equipment maker plans global job cuts amid lower demand.

The firm, famed for its iconic yellow diggers, said it is “contemplating” moving production from its sole plant in Gosselies, Belgium to one in Grenoble, France and other manufacturing sites outside Europe.

“If this intention would be confirmed, it would result in a collective lay-off of about 2,000 employees and in the closure of the Gosselies site,” Caterpillar said on its website.

Antonio Cocciolo, an official for the FGTB union, expressed “total disgust” when he told AFP that an American executive speaking in English effectively announced the “complete closure of the site” in the French-speaking area of Belgium.

Appearing shocked or in tears, several workers gathered Friday at the plant near Charleroi airport, south of the Belgian capital Brussels where a heavy vehicle blocked one entrance.

Some 1,300 jobs were already cut in 2013 at the plant in a region where unemployment has topped 20 percent.

“It’s an abrupt decision and a real drama,” Belgian Prime Minister Charles Michel was quoted as saying by Belga news agency as he pledged to work closely with the regional government to support workers and their families.

In another statement on Thursday, Caterpillar said it was also considering closing its Monkstown facility as part of restructuring in Northern Ireland that could result in the loss of up to 250 jobs.

The company is also mulling stopping production of 25-tonne and larger material handlers in Northern Ireland, including the planned launch of large material handler models for Europe.

Caterpillar linked its statement Friday to the “global restructuring and cost savings plan announced in September 2015,” which called for cutting 10,000 jobs worldwide, or nine percent of its work force, and closing 20 plants.

In July, Caterpillar said it planned additional job cuts in the second half of 2016 as sluggish conditions in the energy and mining sectors weighed on second-quarter earnings.

Caterpillar, which manufactures industrial equipment for energy, mining and construction companies, said it expects higher costs due to restructuring and job cuts as it cited global economic uncertainty due in part to political upheaval in Turkey and Britain.

Net profit fell 31 percent to $550 million. Revenue fell 16 percent to $10.3 billion.

Sales dropped in all three of Caterpillar’s industrial businesses. Caterpillar acknowledged that oil prices have risen in 2016, but said the jump has not sparked major new investment.