Industrial giant Caterpillar Inc. is moving its headquarters from suburban Chicago to Irving.
The company has about 120 workers now in an Irving office and Caterpillar spokeswoman Kate Kenny said the size of its 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’s in the best strategic interest of the company to make this move, 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 a statement.
Caterpillar, which posted $51 billion in revenue last year, will become the fifth-largest public company headquartered in North Texas. It will trail only Exxon Mobil, McKesson, AT&T and Energy Transfer. Exxon is moving its D-FW headquarters next year to the Houston area.
The move will make Dallas-Fort Worth home to 24 Fortune 500 companies. Ten of those will be in Irving, which bills itself as the “headquarters of headquarters” city. Dallas-based Builders FirstSource recently announced its relocation to Irving.
Caterpillar didn’t request incentives for the headquarters move, Kenny said.
Beth Bowman, president and CEO of Irving-Las Colinas Chamber of Commerce and Irving Economic Development Partnership, said companies choose Irving and D-FW because its business-friendly environment, favorable tax structure and its people.
“Our focus is to make sure Caterpillar, their entire team within their global headquarters, know that they are coming into a community that wants them and we look forward to integrating them,” Bowman said.
Gov. Greg Abbott said the company’s relocation is a “testament to the boundless opportunity Texas has to offer.” He noted the move means Texas will be home to 54 Fortune 500 companies.
“Businesses of all sizes and people from all backgrounds can grow and succeed in the Lone Star State because we champion a world-class economic environment fueled by the lowest business operating costs in the nation, a reasonable regulatory environment and a lower cost of living coupled 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 driving the move.
“We believe being in the Dallas Fort-Worth market will give us the ability to attract new talent and provide additional career opportunities for our current employees to aid in retention,” Kenny said. “The Irving location provides global access to our employees, customers and dealers with close proximity to two major airports.”
Caterpillar’s office in Irving’s landmark Williams Square gives employees a mix of downtown Dallas and suburban residential areas and a range of housing price points and high-quality school districts, Kenny said.
In 2017, the company moved its global headquarters from Peoria, Ill., to Deerfield, Ill., taking over a former headquarters of a premium spirits maker. At the time, Caterpillar did not receive any incentives from Deerfield or the state, according to the Chicago Tribune. There are 230 employees at the Deerfield office, which Kenny said the company expects to relocate to Irving over time.
She said the company will keep its Deerfield office lease to allow for a smoother transition.
Caterpillar employed 107,700 workers globally last year, with 63,400 located outside the United States. Its largest business segments are construction industries, which generated $22.1 billion last year, and energy and transportation, which brought in $20.3 billion. It also has a financing arm.
Over 62% of the company’s sales and revenue come from outside the country and over 4 million Caterpillar products operate around the world. There are 124 Texas jobs currently posted at Caterpillar’s career site, with roles in Irving, Seguin, Houston and more locations throughout the state.
Last year, the company consolidated workers from its electric power division in Las Colinas.
North Texas is gaining the corporate headquarters of a company “positioned to capitalize on an economic recovery, with infrastructure stimulus augmenting 2023 growth,” according to Bloomberg Intelligence industrials analyst Christopher Ciolino. The infrastructure funding could create a $27 billion to $38 billion revenue opportunity for construction equipment manufacturers over the next five years.
Ciolino projects double-digit earnings growth for the company, buoyed by strong demand, higher commodity prices and an extended 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 also stands to benefit from increased renewable energy initiatives through mined commodities and sales of turbines and generators needed to modernize the electric grid, Ciolino wrote. It operates an autonomous mining fleet of 525 machines at 20 sites globally.
Caterpillar joins heavy machinery maker Kubota Tractor Corp. in logistics-rich North Texas. The Japan-based company moved its U.S. headquarters from California to Grapevine in 2017 for a more central location to serve its U.S. dealers and manufacturing and distribution facilities in Kansas and Georgia.
Caterpillar’s dealer network includes 44 locations in the U.S. and 116 outside the country.