PEORIA — Consolidation continues at Caterpillar Inc.

The company announced Wednesday that the electric power division and the marine and petroleum power division will be re-formed into a new electric power, marine and oil and gas division led by Vice President Tom Frake.

This will occur following the retirement of Steve Niehaus, vice president for the electric power division.

The changes are effective June 1.

Caterpillar Chairman and CEO Doug Oberhelman said the move will “reduce costs in this challenging environment.”

“Consolidating these energy operations, along with the recently announced integration of two divisions within customer and dealer support, will bring efficiencies and a streamlined leadership team. With these changes, we will have reduced executive leadership by 13 percent since 2013,” said the Caterpillar CEO.

The consolidation is the latest in a series of moves that Caterpillar has made since September 2015, when the company announced plans to reduce operating costs through plant closings and layoffs.

Caterpillar has said it would lay off 10,000 employees by 2018.

In its outlook offered last month, Caterpillar has said no improvement in economic growth or commodity prices was expected in 2016.

Niehaus has elected to retire after 25 years with the company, including the last three as vice president over the electric power division.

“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,” said Jim Umpleby, Caterpillar group president for energy and transportation.

“(Niehaus) 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,” Umpleby said.

Frake, a 30-year veteran of Caterpillar with a broad marketing and product background, has led the marine and petroleum power division since 2012.

 Steve Tarter is Journal Star business editor. Tarter’s phone number is 686-3260, and his email address is starter@pjstar.com. Follow him on Twitter @SteveTarter