Caterpillar has some bad news.
On Thursday, the industrial giant announced that it as part of a restructuring plan it will cut up to 10,000 jobs in the face of what it called, “a convergence of challenging marketplace conditions in key regions and industry sectors — namely in mining and energy.”
In pre-market trading, shares of the company were down as much as 6% on Thursday.
Year-to-date, the stock is down about 25%.
Caterpillar is seen as a bellwether for the global economy because its equipment is big and expensive and often the kind of investment a company only makes when they feel confident about their prospects and the global economy.
Additionally, Caterpillar has been seen as one of the leading indicators on China’s economic slowdown given the decline in the company’s sales in that region over the last several years.
In its announcement on Thursday, the company notes that 2015 will be its third straight year of sales declines. And with sales also expected to decline in 2016, the company could be looking at its first four-year stretch of sales drops in its 90-year history.
In a statement, Caterpillar CEO Doug Oberhelman said, “We recognise today’s news and actions taken in recent years are difficult for our employees, their families and the communities where we’re located. We have a talented and dedicated workforce, and we know this will be hard for them.”
More to come…
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