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Caterpillar Buys Autonomous Electric Tractor Firm Monarch
Deal Follows Monarch Layoffs and Pivot to Licensing of Its Self-Driving Technology
Caterpillar Inc. has acquired self-driving electric tractor startup Monarch Tractor, according to people familiar with the matter.
Monarch, which at its peak drew comparisons to Tesla within the agriculture industry, ran into problems while growing the business and laid off staff in recent months. The startup said in a LinkedIn post late last week that its technology had been bought by “a large global equipment manufacturer” but did not disclose the manufacturer’s name. The two people asked not to be identified because they weren’t authorized to speak publicly.
Caterpillar and Monarch didn’t respond to requests for comment.
“Building and scaling a new tractor platform in agriculture came with unforeseen challenges. We had to make difficult decisions,” like moving from manufacturing to licensing its technology for use in settings including tractors and construction equipment, Monarch wrote on LinkedIn. Construction equipment is a key part of Caterpillar’s roughly $369 billion business.
Monarch is the latest climate tech startup to struggle to commercialize its carbon-cutting solutions. In the past four weeks alone, green cement startup Sublime Systems laid off two-thirds of its staff, and battery recycler Ascend Elements filed for bankruptcy.
While climate tech investments grew slightly in 2025 compared to the previous year, investors crowded into a handful of areas largely tied to the data center buildout. Investors are more pessimistic about green startups serving agriculture.
Statistics from BloombergNEF show that globally, venture capitalists poured a total of $1.3 billion into agriculture-focused clean tech last year, roughly one-third of such investment in 2022. The sector received just $141 million in equity financing in the first quarter of this year, a 50% drop compared to the rolling four-quarter average.
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Monarch raised a total of $251 million before the acquisition from investors that included Astanor Ventures, At One Ventures and HH-CTBC Partnership, an affiliate fund of Foxconn, according to Pitchbook data.
Founded in 2018 by a team that included Tesla Inc. alum Mark Schwager and winemaker Carlo Mondavi, Monarch was among a crop of upstarts aiming to replace fuel-guzzling heavy machinery with electric models. The agriculture sector alone is responsible for some 10% of U.S. greenhouse gas emissions. Other electric tractor manufacturers include Solectrac Inc., which was acquired by Ideanomics Inc. in 2021.
