Restructuring plans by US group Caterpillar could result in the closure of at least one of its three plants in Northern Ireland and the potential loss of 250 jobs, the equipment manufacturer has told its local workforce.

The decision highlights the “crisis” gripping the North’s manufacturing sector, trade unions have warned.

Caterpillar has confirmed it may completely close a plant in Monkstown, Newtownabbey, and consolidate logistics at both its Larne and Springvale facilities as part of a review of its Northern Ireland division.

The US engineering giant said it was also considering discontinuing production of the 25-ton and larger material handlers that it currently manufactures in the North.

Caterpillar, which has a workforce of 1,800 locally, has been a significant employer since it acquired FG Wilson in 1999, a business originally established by Northern Ireland entrepreneur Fred Wilson in 1966 to manufacture generator sets.

Larne headquarters

Just a few months ago Caterpillar hosted a celebration at its Larne headquarters, which was attended by past and present employees and members of the Wilson family, to mark the 50th anniversary of the FG Wilson brand.

Despite its proposed, substantial restructuring plans, the US group has pledged that it remains “committed” to the North.

Robert Kennedy, Caterpillar's director of operations in Northern Ireland, said: "The difficult actions we are considering in Northern Ireland are not a reflection of the quality of our dedicated workforce, the support of the local community, nor the business climate in Northern Ireland."

The US group initially warned last year that it was planning to axe 10,000 jobs across its global operation by 2018 to address what it then described as “challenging marketplace conditions in key regions and industry sectors”.

The North’s Minister for the Economy Simon Hamilton said the group’s position had clearly not improved, and there had been ongoing efforts behind the scenes to safeguard the 1,800 jobs in the North.

Mr Hamilton said: “These job losses in Northern Ireland are part of the overall reduction of 10,000 staff across the company.

“The difficulties experienced by Caterpillar have been public knowledge for some time. We have intensified our engagement with the company both locally and in the United States to ensure Caterpillar were fully briefed on the benefits as a manufacturing base and of the complete range of government support available to them at this time”.

Assistance

He said that between April 2011 and March of this year Invest NI had provided more than £270 million of assistance to manufacturing firms in Northern Ireland, and he was determined to continue to support the sector.

Trade union leaders remain intensely critical of how the Northern Ireland Executive has dealt with what its describes as the crisis in the local manufacturing sector where a shadow hangs over the future of thousands of jobs.

Bombardier Aerospace intends to axe a further 95 jobs on top of 630 redundancies already planned in the North this year, while tobacco company JTI Gallaher closed its Ballymena factory in May with the loss of 877 jobs.

French group Michelin also intends to close its tyre plant in the town by 2018 which will result in 860 job losses.

Unite’s regional co-ordinating officer, Davy Thompson, said Caterpillar’s latest move to reduce its workforce should be a “turning point for Stormont”.

“The Northern Ireland Executive parties appear to believe that manufacturing is a lost cause. They voted down proposals for a stand-alone strategy for the sector, and there’s continued failure to win foreign-direct investment in the sector.

“Thousands of experienced, highly-skilled and now redundant, manufacturing workers need appropriate employment opportunities.”