Industrial giant Caterpillar Inc. moves its headquarters from a Chicago suburb to Irving.
The company currently employs about 120 people in an Irving office, and Caterpillar spokeswoman Kate Kenny said the size of the local workforce will depend on future business needs. The international manufacturer of construction and mining equipment, engines, generators and locomotives has had a presence in Texas since the 1960s.
“We believe it is in the company’s best strategic interest to take this step, which supports Caterpillar’s strategy for profitable growth as we help our customers build a better, more sustainable world,” said Chairman and CEO Jim Umpleby in an explanation.
Caterpillar, which had sales of $51 billion last year, will become the fifth-largest public company headquartered in North Texas. It will only outperform Exxon Mobil, McKesson, AT&T and Energy Transfer. Exxon is moving its D-FW headquarters to the Houston area next year.
The move will make Dallas-Fort Worth home to 24 Fortune 500 companies. Ten of those will be in Irving, which bills itself as “Headquarters of Headquarters.” Dallas-based Builders FirstSource recently announced its move to Irving.
Caterpillar did not request incentives for the headquarters move, Kenny said.
Beth Bowman, president and CEO of the Irving-Las Colinas Chamber of Commerce and the Irving Economic Development Partnership, said businesses choose Irving and D-FW for their business-friendly environment, favorable tax structure and people.
“Our focus is on making sure Caterpillar and their entire team at their global headquarters know they’re coming into a community that wants them, and we look forward to integrating them,” Bowman said.
Gov. Greg Abbott said the company’s move was “a testament to the limitless opportunities Texas has to offer.” He noted that the move means Texas will be home to 54 Fortune 500 companies.
“Businesses of all sizes and people from all backgrounds can grow and thrive in the Lone Star State because of our commitment to a world-class business environment driven by the lowest operating costs for businesses in the country, an appropriate regulatory environment and a lower cost of living with an exceptional quality of life,” Abbott said in a statement.
Kenny, the company’s global media and public affairs manager, cited talent attraction as a key reason for the move.
“We believe that being present in the Dallas Fort-Worth market will give us the opportunity to attract new talent and provide our current employees with additional career opportunities to support retention,” said Kenny. “The Irving location offers our employees, customers and dealers worldwide access to two major airports.”
The Caterpillar office in Irving’s landmark Williams Square offers employees a mix of downtown Dallas and suburban residential areas, as well as a range of housing prices and quality school districts, Kenny said.
In 2017, the company moved its global headquarters from Peoria, Illinois to Deerfield, Illinois, taking over a former premium spirits company’s headquarters. Caterpillar received no incentives from Deerfield or the state at the time, it said ChicagoTribune. There are 230 employees in the Deerfield office, who Kenny said the company will relocate to Irving over time.
She said the company will maintain its office lease in Deerfield to allow for a smoother transition.
Caterpillar employed 107,700 people worldwide last year, including 63,400 outside the United States. Its largest businesses are construction, which generated $22.1 billion last year, and energy and transportation, which brought in $20.3 billion. It also has a funding arm.
Over 62% of the company’s sales and revenues come from abroad, and over 4 million Caterpillar products are in use around the world. There are currently 124 Texas jobs posted on the Caterpillar careers site, with positions in Irving, Seguin, Houston and other locations across the state.
Last year, the company consolidated employees from its electricity division in Las Colinas.
North Texas will be home to a company “positioned to benefit from an economic recovery, with infrastructure incentives driving growth in 2023,” according to Bloomberg Intelligence industry analyst Christopher Ciolino. Infrastructure financing could provide construction equipment manufacturers with a $27 billion to $38 billion revenue opportunity over the next five years.
Ciolino forecasts double-digit earnings growth for the company, supported by strong demand, higher commodity prices and an expanding backlog.
Its services unit, which works with customers to extend the life of expensive machinery, represents its biggest growth opportunity over the next four years, Ciolino wrote in May after an investor day in Grapevine. The company expects to double its services revenue to $26 billion by 2026.
The company will also benefit from increased renewable energy initiatives through the mining of raw materials and the sale of turbines and generators needed to modernize the power grid, Ciolino wrote. It operates an autonomous mining fleet of 525 machines at 20 locations worldwide.
Caterpillar joins forces with heavy equipment manufacturer Kubota Tractor Corp. in logistically rich North Texas. The Japan-based company moved its US headquarters from California to Grapevine in 2017 to find a more centralized location to serve its US dealers and manufacturing and distribution facilities in Kansas and Georgia.
Caterpillar’s dealer network includes 44 locations in the United States and 116 outside the country.