Title: Caterpillar Acquires Monarch Tractor Amid Struggles in the Electric Farming Sector
In a significant industry shift, construction powerhouse Caterpillar has acquired the assets of Monarch Tractor, a startup that once championed the future of autonomous farming machinery. This acquisition comes on the heels of Monarch’s difficulties in transitioning to a software-centric model, as reported in filings with the United States Patent and Trademark Office.
First highlighted by Bloomberg, this acquisition marks the end of a tumultuous chapter for Monarch Tractor, which faced multiple rounds of layoffs, lawsuits from dealers, and the loss of its manufacturing partner, Foxconn. The company’s challenges appeared to intensify recently when co-founder Carlo Mondavi publicly expressed his departure after clashing with CEO Praveen Penmetsa over the strategic focus on software services.
When reached for comment, neither Mondavi nor Penmetsa provided additional insights, with Penmetsa only referring to a prior statement from Monarch about its acquisition by a “large global equipment manufacturer.” Caterpillar has not yet responded to requests for details about the transaction.
Founded in 2018 by Mondavi, Penmetsa, and former Tesla executive Mark Schwager, Monarch Tractor aimed to revolutionize agriculture with “driver optional” electric tractors designed for wineries, fruit farms, and dairy operations. Over the past eight years, the company successfully raised over $200 million but strayed from its initial production plans. Rather than building tractors at its Livermore, California, facility, Monarch joined forces with Foxconn to utilize a former GM plant in Lordstown, Ohio.
Foxconn envisioned producing vehicles for multiple electric vehicle startups alongside Monarch’s tractors; however, reality fell short. The company managed limited production of Monarch tractors but eventually sold the plant to SoftBank, leaving Monarch in search of new manufacturing opportunities.
As the company’s challenges mounted, Monarch made substantial workforce reductions, initially laying off staff in early 2024 before securing a $133 million funding round. Soon after, further layoffs were announced as Monarch shifted its focus toward software development and licensing its autonomous technologies.
Dealers have reported issues with Monarch’s tractors, claiming the autonomous technology underperformed. One dealer, who filed a lawsuit in September 2025, labeled the tractors as “defective” and incapable of autonomous operation—a claim that Monarch denied. Additional lawsuits have since emerged from other dealers, revealing ongoing disputes about the product’s reliability.
Mondavi, reflecting on his exit, noted in an Instagram comment that he left due to “fundamental differences” with Penmetsa regarding how to address reliability issues. He believed hardware solutions were necessary, while the CEO leaned towards software fixes. This discord ultimately led to his departure alongside another co-founder.
In a final bid to recoup losses, Monarch auctioned off its remaining assets earlier this year. As the dust settles on this acquisition, the fate of Monarch’s vision for autonomous farming now rests with Caterpillar, a company known for its stronghold in heavy machinery and construction. Whether this merger can revitalize Monarch’s ambitions remains to be seen.