UPDATE 2-Caterpillar might build excavator facility in U.S.

*Move would triple CAT’s US output of earth-moving machines

*Would allow Japanese plant to focus on Asian demand

*Would create hundreds of jobs in CAT’s US operations
(Recasts first sentence, adds details on proposed move,
industry background, changes dateline previously NEW YORK)

By James B. Kelleher

CHICAGO, March 11 (BestGrowthStock) – Caterpillar Inc (CAT.N: ) said
on Thursday it may build a new hydraulic excavator plant in the
United States, a move that could triple its current U.S. output
of the earth-moving machines and add hundreds of jobs to its
recession-ravaged payroll.

The world’s largest maker of construction and mining
equipment, currently manufactures in Japan all but two of the
hydraulic excavator models it sells in North America. The two
non-Japanese made models are produced in a plant in Aurora,

The machines are essentially modern-day versions of what
used to be called steam shovels. They are often equipped with
buckets and used by builders to dig in confined areas.

A Caterpillar spokesman said that if the company decides to
build the new U.S. plant, Caterpillar would concentrate all its
excavator production for North America at the facility.

The proposed move would free up excavator capacity at the
Japanese plant, permitting it to better serve the fast-growing
Asian markets on its doorstep.

It would also allow the Aurora facility — which makes a
variety of other construction-related equipment including
wheeled dozers and soil compactors — to simplify its
operations and ramp up production of those tools when the
hard-hit markets it serves eventually rebound.

Caterpillar said a final decision on the move would come
“at a later date.” Even so, news of the study provided a ray of
hope in a sector that has not seen a lot of light recently.

The U.S. economic downturn that began in December 2007 has
been especially brutal for manufacturing workers, who absorbed
a disproportionate share of the job losses associated with the

Manufacturing generates less than 12 percent of U.S.
economic output and accounts for less than 9 percent of the
jobs in the country. Yet it accounted for more than 26 percent
of the 8.4 million layoffs in the downturn, according to the
U.S. Department of Labor.

Last year alone, the U.S. manufacturing sector shed 11.4
percent of its total workforce — the largest one-year
percentage drop since the Great Depression, dwarfing even the
10.4 percent drop seen in 1945, when America’s victorious
industrial war machine throttled back production.

Caterpillar alone has laid off more than 30,000 full-time
and contract workers, many of them in the United States, over
the past two years as it scrambled to bring its output of
construction and mining equipment, and diesel and turbine
engines, in line with fast-falling demand.

Stock Market Today

(Additional reporting by Helen Chernikoff, editing by Gerald
E. McCormick and Matthew Lewis)

UPDATE 2-Caterpillar might build excavator facility in U.S.