Caterpillar’s Headquarters Are Moving to Texas

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Caterpillar

is moving headquarters from its longtime base in Illinois to the Dallas-Fort Worth area in Texas, following the footsteps of other major manufacturers that have relocated over the past year or plan to do so.   

The maker of the iconic yellow construction and mining equipment said Tuesday that its existing office in Irving, Texas, a suburb of Dallas, would serve as its new global headquarters, and that it would begin the transition this year. 

Caterpillar

(ticker: CAT) has had a presence in Texas since the 1960s, according to the firm, but Illinois remains the largest concentration of Caterpillar employees. “We believe it’s in the best strategic interest of the company to make this move,” said Caterpillar Chairman and CEO Jim Umpleby in a statement, not specifying the reason.  

The move would deal a blow to the state of Illinois, which the manufacturing giant——with more than 107,000 employees globally——has called home for nearly a century. The company was based in Peoria for many decades before shifting its headquarters to Deerfield, a Chicago suburb, in 2018. 

Illinois Governor J.B. Pritzker, whose office didn’t immediately respond to a request for comment from Barron’s, is seeking a second term in November’s election.

Caterpillar is the latest big employer to move camp to Texas. Electric car maker

Tesla

(TSLA) and software giant

Oracle

(ORCL) both relocated to Austin from California in the past year.

Hewlett Packard Enterprise

(HPE) and

Toyota Motor

(TM) have also moved to Texas in the past few years. Texas is known for cheaper living costs, lower taxes, and less stringent regulation.

Caterpillar said it wasn’t getting any economic or tax incentives related to the headquarters move, The Wall Street Journal reported.

Virginia is another popular destination.

Boeing

(BA) said last month it would move headquarters out of the Chicago area to Arlington, Va., followed by

Raytheon Technologies

(RTX), which plans to move to the region from its current base in Massachusetts. Many other military contractors are already based in the area because of its proximity to the federal government and a pool of engineering talent.

Caterpillar stock remains largely flat so far this year as most corners of the market are sinking. The

S&P 500
officially entered a bear market on Monday.

The company reported $13.6 billion in revenue for the first quarter of 2022, an increase of 14% from the same period last year. It held an investor day event last month in Dallas, where it announced a new share buyback plan of $15 billion, or about 13% of the company’s market capitalization.

Write to Evie Liu at [email protected]