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Caterpillar moving headquarters to Chicago area

PEORIA, Ill. (AP) — Caterpillar Inc. is moving its headquarters to the Chicago area and won't build a new complex in its current Peoria location.

In 2015, Caterpillar CEO Doug Oberhelman unveiled plans for a 31-acre new headquarters complex for the company in downtown Peoria, vowing that  "we're here in Peoria to stay." However, in September of that year, the plan was put on hold.

Now, the company says it won't build the previously announced headquarters complex in Peoria due to a "challenging market conditions and the need to prioritize resources to focus on growth."

The move comes as the company faces a weak equipment market that has been cutting into its bottom line. Last week, the farming and construction equipment maker reported a wider fourth-quarter loss on charges and higher restructuring costs. It has been cutting jobs and facilities over the last several years.

Caterpillar said the vast majority of its people will remain in central Illinois. The current Caterpillar building in Peoria will continue to be used.

The company says it will locate a limited group of senior executives and support functions in the Chicago area later this year. It calls Chicago a more strategic location. Caterpillar expects about 300 people to be based at the new location.

CEO Jim Umpleby says locating Caterpillar's "closer to a global transportation hub, such as Chicago, means we can meet with our global customers, dealers and employees more easily and frequently."