The US plant giant axed nearly half the 1,000-plus workforce two years ago as it ran down production of trucks and earthmovers.
The plant took on 250 agency workers in 2010 to help meet a recovery in demand and now hopes to approach its former yearly output of 3,000 vehicles by the end of this year.
Phil Handley, manager at Peterlee site, said the factory was working at a third of our capacity in 2009 and demand dropped by 86%.
Staff went on short-term working and bonuses were cut but in the end Cat was forced to lay off 300 agency staff and around 100 core workers.
He said: “But it has really started to come back. By April last year we were back to near normal working and orders had doubled and later in the year the order book rose to four times what it was 12 months before. It is looking very good now.”