CATERPILLAR STRATEGY

Caterpillar Strategy



Caterpillar Strategy

Introduction

Caterpillar is one of the largest manufacturers of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines. The company provides its products and services in three fields which include machinery, engines and financial products. A strong market position increases the bargaining leverage of the company and its access to a variety of end markets provides it with increased cross selling opportunities. However, intense competition would thus put pressure on the market share of the company

Caterpillar is a manufacturer of machinery and equipment for a number of industries. The company is organized into four divisions: machinery, engines, financial products, and Cat Logistics. The machinery line of business includes the design, manufacture, marketing and sales of construction, mining and forestry machinery, track and wheel tractors, track and wheel loaders, pipelayers, motor graders, wheel tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, log loaders, off-highway trucks, articulated trucks, paving products, telescopic handlers, skid steer loaders and related parts. The company also includes logistics services for other companies in this line of business. The engines segment includes the design, manufacture, marketing and sales of engines for Caterpillar machinery; electric power generation systems; on-highway vehicles and locomotives; marine, petroleum, construction, industrial, agricultural and other applications, and related parts. The company manufactures diesel, heavy fuel and natural gas reciprocating engines for the on- and off-highway mobile markets, as well as for a range of stationary applications and manufactures industrial turbines for the oil and gas, and power generation markets. The financial products segment consists primarily of Cat Financial, Cat Insurance, Cat Power Ventures and their respective subsidiaries. Cat Financial provides a range of financing alternatives to customers and dealers for Caterpillar machinery and engines, solar gas turbines, as well as other equipment and marine vessels. Cat Financial also extends loans to customers and dealers. Cat Insurance provides various forms of insurance to customers and dealers to help support the purchase and lease of the company's equipment. Cat Power Ventures is an active investor in independent power projects using Caterpillar power generation equipment and services. Cat Logistics provides supply chain solutions and services to the company and over 50 companies throughout the world. Cat Logistics, a wholly owned subsidiary of Caterpillar, provides supply chain solutions and services to the company and over 50 companies throughout the world. It operates 100 offices and facilities in 25 countries on six continents. Caterpillar Logistics provides its full-service capabilities to companies in market sectors that include automotive service parts, industrial service parts, consumer durables, technology and electronics, manufacturing logistics and aerospace service parts. Chairman Fites has put in place a strategy designed to make Caterpillar globally competitive using predominately United States-based manufacturing operations. One element of this strategy includes implementing a six-year capital-investment program aimed at cultivating more flexible manufacturing operations. Another strategic ingredient is a focus on new product development. Also, the company is a strong supporter of the General Agreement on Tariffs and Trade (GATT) and the North American Free Trade ...