EAST PEORIA — World War I left many legacies in its wake. But for central Illinois, one of its most lasting is perhaps that it set the stage for the company we know today as Caterpillar Inc.
It was during the wartime years that the two corporations that later merged to form Caterpillar Tractor Co. truly came into their own.
"(Holt Caterpillar Co.) and (C.L. Best Tractor Co.) probably never would have merged if it wasn't for World War I," says the Fortune 100 company's lead historian, Lee Fosburgh.
It's not that the war suddenly made one or the other of them a global company — Holt already had a brisk overseas business among both Allied and Central powers prior to the 1914 outbreak of hostilities. Instead, the war provided the impetus for expansion and innovation.
As the war began, Holt sold tractors to Britain and France, for use in helping to haul equipment like howitzers — and occasionally troop transports — and from the front.
Most of that production was done at the company's East Peoria plant, Fosburgh said, and not from the other Holt production site in California, because it was more cost-efficient to build here and ship goods to port and then to the front — much the same argument that has been used for decades in favor of Peoria's links by road, rail and river.
But when the United State entered the war in April 1917, plant manager Murray Baker was pitching the federal government on the need to contract for tractors for the military.
"When Baker did the contract with the government, which we have in the archives, there's a note with it, and they essentially said, 'Build us as many tractors as you can,'" Fosburgh said. "And that's what they did."
It was an employment boom for the region as the plant expanded.
"Before the war, we were talking thousands of people maybe, but during the war we're talking five digits (more than 10,000 employed)," said Fosburgh, the company's heritage services supervisor who oversees a sprawling archive of Caterpillar history.
With government aid, the plant's footprint expanded in East Peoria, doubling and tripling in size.
It also didn't hurt that the company had a friend in high places — or at least someone who had experience with its equipment.
American Expeditionary Force commander Gen. John "Black Jack" Pershing had previously used Holt tractors in action during the hunt for Pancho Villa on the Mexican border and was "a big proponent of Holt equipment," Fosburgh said. A short film reel in the company archive shows Pershing inspecting Holt equipment in East Peoria and observing demonstrations there.
(The company archives also boast a letter sent to another famous name just after the war, passing along praise of Holt equipment to then-Col. George S. Patton with the Army's tank corps.)
One thing that Holt never supplied to the war effort was tanks, but the company does have a history with them. The British general widely credited with introducing tank warfare, Ernest Swinton, got the idea for the apparatus from seeing Holt tractors — and their treads — in operation. That's something Holt used later used in its marketing material, Fosburgh said.
The company tried to build tank prototypes, but none of them made it past the testing stage. However, the British government did send Holt the gift of a U.K.-made tank, which was kept in a Downtown Peoria park and rolled out for armistice parades in both Peoria and East Peoria, Fosburgh said.
But in order to throw its all into the war effort, "they abandoned the domestic market because they were essentially told to (under the terms of the contract)," Fosburgh said. "But you had companies like C.L. Best that all of a sudden were able to capture that domestic market. And because of that, they were able to put in research and development."
That left Holt with high revenues at the end of the war, in search of a domestic market again as its profits declined, and Best with higher domestic profits but less overall capital since it was newer to the market.
The two needed each other, "and that's what created Caterpillar today," Fosburgh said. "That expansion of the East Peoria plant and the modernizing it during the war is what led to that being the main plant for the new Caterpillar company."
Two decades later, when World War II loomed, there was still enough institutional memory of the position the company had been in at armistice that Caterpillar executives were more aware of the transition between peacetime and wartime production.
"Cat fought to keep at least its finger in the domestic market and be able to move hopefully quickly (back) after the war," Fosburgh said.
Chris Kaergard can be reached at firstname.lastname@example.org or 686-3255. Follow him on Twitter @ChrisKaergard.