Caterpillar to end production of on-highway vocational trucks

Equipment manufacturer also announces personnel and divisional changes.

February 26, 2016
CDR Staff
Peoria, Illinois-based equipment manufacturer Caterpillar Inc. has announced it will discontinue production of its on-highway vocational trucks.

Caterpillar says based on the current business climate in the truck industry and a thorough evaluation of the business, the company decided it would withdraw from this market. This move also is in line with the company’s ongoing restructuring to align its businesses with existing conditions. As a result of this action, Caterpillar says it will cease taking new orders for vocational trucks, although the company notes it remains committed to existing truck customers and will support the existing trucks currently on the road.

Caterpillar launched its first vocational truck in the North American market in 2011, working with Navistar on the products’ design and build. Last year, the company announced its intention to begin independently designing and manufacturing its vocational truck products at the Caterpillar plant in Victoria, Texas.

“Remaining a viable competitor in this market would require significant additional investment to develop and launch a complete portfolio of trucks, and upon an updated review, we determined there was not a sufficient market opportunity to justify the investment,” says Ramin Younessi, vice president with responsibility for Caterpillar’s industrial power systems division. “We have not yet started truck production in Victoria, and this decision allows us to exit this business before the transition occurs.”

The announcement affects approximately 70 positions. The reductions will begin in March and will take place over a period of time, the company says.

In other company news, Caterpillar announced changes to its personnel, including:

  • Steve Niehaus, currently vice president with responsibility for the electric power division (EPD), is retiring.
  • Following Niehaus’ retirement, the company will consolidate the electric power and marine and petroleum power divisions (MPPD) into the new electric power, marine and O&G division (EPMOG), led by current MPPD Vice President Tom Frake.
Niehaus has elected to retire after 27 years of service with the company, including the last three as vice president with responsibility for EPD.

“Much of Steve’s career has been spent in marketing and commercial engines, and in his most recent position, he has provided critical leadership in strengthening and aggressively growing Caterpillar’s electric power business,” says Jim Umpleby, Caterpillar group president with responsibility for energy and transportation. “He has lived all over the world helping our customers and employees develop and grow—from Saudia Arabia to Brazil to Singapore and throughout the United States. I’m grateful to Steve for his many contributions to Caterpillar and wish him well in retirement.”

Since joining Caterpillar in 1989 as a marketing trainee, Niehaus has held numerous positions in the commercial engine businesses, large engine center marketing and Solar Turbines. In 2013, he was named vice president of EPD.

He graduated from the University of Iowa with a bachelor’s degree in business administration and also completed the Digging Deep Program with the Stanford University Graduate School of Business.

Frake, a 30-year veteran of Caterpillar, has a broad marketing and product background. He has led MPPD since 2012, which provides a solid foundation for the newly formed EPMOG.

“We continue to focus on our customers’ success with leading and innovative products, services and solutions, while also reducing costs in this challenging environment,” says Caterpillar Chairman and CEO Doug Oberhelman. “Consolidating these energy operations along with the recently announced integration of two divisions within Customer & Dealer Support will bring efficiencies and a streamlined leadership team. With these changes, we will have reduced executive leadership by 13 percent since 2013.”

The changes are effective June 1, 2016. For bios of each of the officers, visit