Analytical target cascading (ATC), a hierarchical, multilevel, multidisciplinary coordination method, has proven to be an effective decomposition approach for large-scale engineering optimization problems. In recent years, augmented Lagrangian relaxation methods have received renewed interest as dual update methods for solving ATC decomposed problems. These problems can be solved using the subgradient optimization algorithm, the application of which includes three schemes for updating dual variables. To address the convergence efficiency disadvantages of the existing dual update schemes, this paper investigates two new schemes, the linear and the proximal cutting plane methods, which are implemented in conjunction with augmented Lagrangian coordination for ATC-decomposed problems. Three nonconvex nonlinear example problems are used to show that these two cutting plane methods can significantly reduce the number of iterations and the number of function evaluations when compared to the traditional subgradient update methods. In addition, these methods are also compared to the method of multipliers and its variants, showing similar performance.