Caterpillar today announced massive layoffs and warned of a tough year ahead as a downturn that began in the United States metastasized into a full-blown global recession, gutting orders for earth moving equipment. Caterpillar also reported lower than expected fourth quarter earnings, was laying off 20,000 workers and buying out 2500 others and predicted what would be the weakest year for business since the end of WWII.
The layoffs and buyouts, which will hit one out of every ten of the company's regular workers, and will idle an additional 8000 contract workers. many of them in the Peoria area.
"It's just a pessimistic outlook in terms of the world economy", said the chief investment officer of Solaris Asset Management in Bedford Hills, NY. Clearly the building of global infrastructure has come to a grinding halt".
Caterpillar stock plunged on the news and is now trading at approximately 60% from it's eighteen months highs.