Caterpilla Inc

Caterpillar (CAT) Inc.

According to the Bureau of Economic Analysis, the United States exported $ 2.1 trillion worth of goods in 2011. In addition, Export Nation 2012 indicated that exports play an important role in pulling the US economy out of resection. Emilia Istrate, author of the New Report says, “Export is helping us out of recession and into recovery “. Amount the top ten U.S Manufactured Export Products are:

Electrical Equipment ($ 32.2 billion), Fabricated metal products( $ 32.6 billion), Medical Equipment, sporting goods and miscellaneous( $ 49.6 billion), Petroleum and coal product ($ 50.9 billion),food($ 50.9 billion), computer and electronics (121.4 billion), transportation ( $175.8 billion), machinery ($124.6 billion) and chemicals( $171.2 billion). This date indicates that the industry of transportation is the largest U.S. export contributor’s .Therefore, in this essay I have chosen Caterpillar (Cat). I will talk about the history, challenges, recipe for success, competitors and what others export companies can learn from it.

The Caterpillar name was originated in 1904 by inventor Benjamin Holt in Stockton, CA. Today, Caterpillar Inc. is headquartered in Peoria, Illinois and is a Fortune 100 companies. Caterpillar Inc. (CAT) is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel electric locomotives. It operates; machinery, power systems, and financial products. Cat Financial, along with Caterpillar dealerships and around the world serves customers where they live and work. In addition to the offices in the United States it locations include; Belgium, Canada, China, Indonesia, Japan, Korea, Malaysia, Singapore, Thailand, the Philippines, Australia, New Zealand, the Czech Republic, Denmark, France, Germany, Austria , Switzerland , Ireland, Italy, the Netherlands, Norway, Poland, Portugal, Romania, Russia, Slovenia, Spain, Sweden, the United Kingdom, Ukraine, Brazil, Chile, Mexico, Peru and Panama.

In 2008 caterpillar was challenge by the economy crisis. Production and sales fell. The rumors circulated throughout the company, employees cuts and the closure of couple of locations was been considered. Operations and financial condition were materially affected by the conditions in the global economy .The continuing global economic crisis and capital markets had a significant impact on sales and revenues .Overall, the company’s sales and revenues decreased 37 percent from 2008, and profit was down 75 percent from 2008. A whole year results marked a significant decline in sales and revenues and profit for Caterpillar.

In spite of the severe economic conditions Caterpillar improved the balance sheet and maintained a stable dividend rate. Caterpillar then decided to invest in Central America starting with Panama. In 2008 LA PRENSA reported that the world’s largest manufacturer constructions and mining equipment, diesel, natural gas engines and industrial gas turbines have purchased land in Veraguas in Panama for a training center. The Panamanian government has given its full support in the development. As Caterpillar increases business throughout Central America. In 2009, the company made selective investments in growth and expansion opportunities it focused on the economic recovery. Despite of the challenge and economic conditions Caterpillar made progress by expanding their business in; China and other emerging markets and moving towards achieving market leadership positions. According to Economy Today, as of December 31, 2009 Caterpillar employed 93,813 of whom 50,562 were located outside the United States.

Randy Krotowski Caterpillar vice president explained that the reason for Caterpillar’s success is based on strategy and also realized that when you have money to spend you must spend it carefully.

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