Caterpillar

Mission:-

Become A Global Leader.

Vision:-

Be the global leader in customer value.

Introduction

Caterpillar Inc. (CAT) is a United States-based corporation headquartered

in Peoria, Illinois. Caterpillar (commonly referred to simply as CAT) is,
according to their corporate website, "the world's largest manufacturer of
construction and mining equipment, diesel and natural gas engines, and
industrial gas turbines."

Famous for their products featuring caterpillar tracks and a distinctive

yellow paint scheme, Caterpillar produces a wide range of engineering
vehicles, including the range of Caterpillar bulldozers.

Caterpillar is one of the thirty companies whose stock is tracked in the Dow
Jones Industrial Average. It is a Fortune 500 company, ranked number 50 in
2008, and first in its industry, with more than $30 billion in assets.
Current board of directors

• James W. Owens - Chairman and CEO

• W. Frank Blount
• John R. Brazil
• Daniel M. Dickinson
• John T. Dillon
• Eugene V. Fife
• Gail D. Fosler
• Juan Gallardo
• David R. Goode
• Peter A. Magowan
• William A. Osborn
• Charles Powell
• Edward B. Rust, Jr.
• Joshua I. Smith

History (1925)

The story of Caterpillar Inc. originates in the late 19th century, when
Daniel Best and Benjamin Holt experimented with ways to fulfill the
promise that steam tractors held for farming. By 1904, these large steam-
powered tractors had been plowing California fields for 14 years, and
occasionally got bogged down in the soft soil, especially after heavy rains.

In 1909, Benjamin Holt bought the abandoned but relatively new

manufacturing plant of a tractor company that had failed in East Peoria,
Illinois. The location offered Holt everything he needed in a manufacturing
center, and despite the hefty amount of capital needed for retooling the
plant, the venture proved so profitable that by 1911 the factory employed
625 people. Around that time, Holt Manufacturing began exporting its
tractors to Argentina, Mexico, and Canada, in addition to their domestic
sales.[4] The Holt Manufacturing Company later pioneered the use of the
continuous track during World War I. Their crawler tractors inspired the first
military tanks, which helped end World War I.

Caterpillar formed on April 15, 1925 with the merger of Holt

Manufacturing Company of Stockton, California and the C. L. Best Gas
Traction Company of San Leandro, California, forming the Caterpillar
Tractor Co. Sales the first year were US$13 million. By 1929, sales
climbed to $52.8 million, and CAT continued to grow throughout the Great
Depression of the 1930s.

After the companies merged, Caterpillar went through many changes,

including the adoption of the diesel engine. During World War II, Caterpillar
products found fame with the Seabees, Construction Battalions of the
United States Navy, who built airfields and other facilities in the Pacific
Theater of Operations. During the post-war construction boom, the
company grew at a rapid pace and launched its first venture outside the
U.S. in 1950, marking the beginning of Caterpillar's development into a
multinational corporation.

Acquisitions

In addition to increasing sales of its core products, much of Caterpillars growth

has been through acquisitions, including 21 companies globally.

Business lines

As of the first quarter of 2006, 44% of Caterpillar's sales are to overseas

customers. Caterpillar products are sold in nearly 200 countries. The
company has a worldwide network of 220 dealers: 63 dealers in the United
States and 157 in other countries. Caterpillar products and components
are manufactured in 51 plants in the United States and 58 plants in
Australia, Belgium, Brazil, Canada, England, France, Germany, Hungary,
India, Indonesia, Italy, Japan, Mexico, the Netherlands, Northern Ireland,
the People's Republic of China, Poland, Russia, South Africa and Sweden.
Caterpillar also licenses or subcontracts the manufacture of Caterpillar-
branded clothing, hats, footwear, and other consumer products.
Caterpillar's historical manufacturing home is in Peoria, Illinois, where its
world headquarters and core research and development activities are
located. Although Caterpillar has "farmed out" much of its local parts
production and warehousing to outside firms, it still has four major plants in
the Peoria area: the Mapleton Foundry, where diesel engine blocks and
other large parts are cast; the East Peoria factory, which has assembled
Caterpillar tractors for over 70 years; the Mossville engine plant, built after
World War II; and the Morton parts facility.
Businesses & Applications

» • Agriculture
Options for your beef cattle operation, dairy operation, and input supply company
or crop production operation.

» • Construction
Equipment designed to fit the needs of the building construction contractor.

» • Demolition & Scrap From razing and scrap handling to loading and
site finishing.

» • Forestry
From road building, millyard and reforestation, to purpose-built machines that
harvest, extract and load.

» • Governmental
Caterpillar is committed to all branches of the military and to U.S. federal
government agencies.

» • Industrial
Equipment designed for trenchers, irrigators, chillers, fire pumps, locomotives,
mining machines and more.

» • Marine
Marine engines and technologies provide proven power and are built to last in
any marine application.

» • Mining
Broadest line of mining equipment in the industry that work harder, last longer
and help move material at a lower cost.

» • Oil & Gas

Global customer focus and market leader in gas compression, drilling, and well
servicing products and systems.

» • Paving
The right equipment, the right people, the right plan.

» • Power Generation
Diesel and gas generator sets to power supplies, automatic transfer switches and
electrical switchgear.
» • Quarry & Aggregates
From wheel loaders to excavators, we have a machine to meet all the
challenges.

» • Waste
From loading at a transfer station or recycling center, handling cover at landfills
or maintaining sites.

Products

Caterpillar 60 (Track-type tractors)

The Caterpillar Sixty Horsepower tractor crawler of 1919 became
the world's first successful bulldozer. Initially developed by the C.L.Best
Company of California, it was one of the models carried over when they
merged in 1925 with the Holt Company to form the company that would
become known as Caterpillar.

Caterpillar (D-Series)

Caterpillar D4
The Caterpillar D4 track-type tractor is a small bulldozer manufactured by
Caterpillar Inc.

Caterpillar first introduced the RD4 in 1938 as the diesel follow on to the
successful CAT 30 gas model. The RD4 had the D4400 engine of 36 hp
(drawbar) In 1935 Caterpillar started the naming convention of 'RD' for
diesel or 'R' for regular gasoline followed by a number to indicate the
relative size. But later changed to Just a D for the Diesel versions. At the
time of introduction the D4 engine produced about 43HP at the drawbar so
the 4 indicated the relative engine power. The D4 U series was fitted with
the new D315 engine. The D4 series engines quickly increased in power
so the numbers just became a figure of merit rather than indicating actual
engine power.

Version details

• 6U = Narrow gauge 44"

• 7U = Wide Gauge 60"
• Caterpillar RD4 - 1936-37 (4G) with D4400 engine 4 cylinder
• Caterpillar D4 - 1937-39 (4G) with D4400 engine 4 cylinder
• Caterpillar D4 - 1939-43 (7J) with D4400 engine 4 cylinder
• Caterpillar D4 - 1943-45 (2T) with D4400 engine 4 cylinder
• Caterpillar D4 - 1945-47 (5T) with D4400 engine 4 cylinder
• Caterpillar D4 - 1947-59 6U1 > 6U12781, 7U1-7U44307 Cat D315 4
cylinder engine.

Caterpillar D5
The Caterpillar D5 is a small track-type bulldozer manufactured by
Caterpillar Inc. the original D5 series was only produced in 1939. The
current D5 series being produced is the D5K.

Engine

• Gross Power: 74.5 kW (100 hp)

• Net Power: 71.6 kW (96 hp)
• Bore: 105 mm (96 in)
Weights

• XL Operating weight: 9408 kg (20,741)

• LGP Operating weight: 9683 kg (21,347 lb)

Caterpillar D6
The Caterpillar D6 track-type tractor is a medium bulldozer manufactured
by Caterpillar Inc. with a nominal operating weight of 18 tons. The Military
versions were classified as the SNL G152 medium tractor, under the G-
numbers classification system used for army tractors.

Caterpillar D7
The Caterpillar D7 Caterpillar track-type tractor is a medium bulldozer
manufactured by Caterpillar Inc. The first D7 appeared in 1938. The D7C
came next in 1955. The D7D came in 1959. The 160hp D7E in 1961. The
180hp D7F 1969.The 200hp D7G in 1974.The 215hp in 1986.The D7H
was the first D7 to come with the exclusive elevated drive sprocket
undercarriage.The D7R replaced the D7H in 1996 with the current D7R
Series 2 replacing that.

In March 2008, at Conexpo 2008 held every 3 years in Las Vegas,

Caterpillar introduced the D7E. This 235hp D7E comes with an electric
drive system powered by a 537cid C9.3 diesel engine. The C9.3 powers a
generator that turns out electricity that will supply power to a pair of AC
drive motors. Compared to the Caterpillar D7R Series II, the D7E is
projected to deliver 25 percent more material moved per gallon of fuel, 10
percent greater productivity and 10 percent lower lifetime operating costs.
The D7R Series II at 240hp power and an operating weight of 25 tons, is in
the middle of Caterpillar's track-type tractors, which range in size from the
D3 57 kW (77 hp), 7 t (8 short tons), to the D11 698 kW (935 hp), 112 t
(124 short tons). It is primarily used to move material short distances or
through challenging terrain. The vehicle is powerful, yet small and light 16
to 20 t (18 to 23 short tons) depending on configuration). This makes it
ideal for working on very steep slopes, in forests, and for backfilling
pipelines safely without risking damage to the pipe.

An agricultural version without the blade and rippers is commonly used by

farmers.

The US Army used armored D7G to clear mine fields and unarmored D7G
and D7H for earthworks. The armor was developed by the Israel Military
Industries (IMI). Later, The US Army developed a remote controlled version
of the D7G for mine-clearing applications.

The current model is the D7R Series 2 Track-Type Tractor and will be
replaced by the D7E in early 2009

Caterpillar D8
The Caterpillar D8 is a large track-type tractor designed and manufactured
by Caterpillar. Though it comes in many configurations it is usually sold as
a bulldozer equipped with a detachable large blade and a rear ripper
attachment.
Caterpillar D9
The Caterpillar D9 is a large track-type tractor designed and manufactured
by Caterpillar Inc. though it comes in many configurations it is usually sold
as a bulldozer equipped with a detachable large blade and a rear ripper
attachment.

The size, durability, reliability, and low operating costs have made the D9
one of the most popular large track-type tractors in the world. The Komatsu
D275A is one of its most direct competitors.

Caterpillar D10
The Caterpillar D10 is a track-type tractor manufactured by Caterpillar Inc.
(then called the Caterpillar Tractor Company). It was the first to use the
elevated drive sprocket to improve durability, operator comfort, and ease of
maintenance.
Caterpillar D11
The Caterpillar D11 is a large Bulldozer, manufactured by Caterpillar Inc. in
East Peoria, Illinois, and mainly used in the mining industry. Primarily
designed as a Bulldozer, it also used for push-loading scrapers, and
ripping rock overburden.

D11T
The current D11T was introduced in early 2008 and is also 850 hp
(630 kW). This comes as a regular bulldozer and a Carrydozer like the
previous model. As with the D11R, the D11T Carrydozer can push
57.9 yards (52.9 m) while the regular D11T can push 45 yards (41 m) of
earth. A new D11T was on display at the Caterpillar display at Minexpo
during the 22 to 24 September, 2008 in Las Vegas, Nevada.

The primary difference between the D11R and the D11T is the controls
inside the operator's cabin. Several levers have been changed into
electronic switches, and several controls have been moved for increased
visibility. Another difference is that the D11T has its exhaust mufflers
moved back closer to the front of the cab like the D10T. They stand taller
than the ones on the D11N/D11R.

Competition
The nearest direct competitor to the Caterpillar D11 is the Komatsu D475.
The Cat can be distinguished from the Komatsu by the elevated drive
sprocket or "High Drive" system which results in a triangular, rather than
oval, shaped caterpillar track. The updated version of the Komatsu, the
D575A is the worlds largest production 'Bulldozer' at 168 tons and 1150 hp.
A bigger machine was built by Italian firm ACCO, with twin CAT engines
giving a combined power of 1,300 hp (970 kW), and weighing 183 tons, in
the 1980s, but this was a special model.

Large Excavators

Caterpillar 345C L
The Caterpillar 345C L is a large hydraulic excavator manufactured by
Caterpillar Inc. The 345C L, with 345 hp (257 kW) of net flywheel power is
classified as a large excavator is in the line of Caterpillar's excavators.
Engine

A Caterpillar 345C L Excavator bucket.

• Engine Model: Caterpillar C13 ACERT

• Net Flywheel Power: 345 hp (257 kW)
• Net Power (ISO 9249): 345 hp (257 kW)
• Net Power (SAE J1349): 349 hp (257 kW)
• Net Power (EEC 80/1269): 345 hp (257 kW)
• Cylinders: 6

Weights

• Operating Weight: 99,150 lb (44,970 kg)

• Operating Weight (long undercarriage): 99,150 lb (44,970 kg)

Wheel Loaders

Caterpillar 930G
The Caterpillar 930G is a hydraulic front end loader manufactured by
Caterpillar Inc. The 930G, with 149hp of net flywheel power at 2300 rpm[1],
it is classified as a small wheeled loader in the line of Caterpillar's
excavators. The MSRP of a standard 930G is $145,400.

Engine

• Net Flywheel Power: 149 hp (110 kW)

• Net Power (ISO 9249)(1997): 150 hp (111 kW)
 • Net Power (SAE J1349): 149 hp (110 kW)
• Net Power (EEC 80/1269): 150 hp (111 kW)

Weights

• Operating Weight: 28,725 lb (13,029 kg)

• Maximum Weight: 29,044 lb (13,174 kg)
• Optional Counterweight: 470 kg (1040 lb)

Dump Trucks

Caterpillar 740 Ejector

The Caterpillar 740 Ejector Articulated Truck is Caterpillar's second
generation of articulated haul truck (dump truck) to have a system that
pushes material out the back of the body. It is the largest articulated haul
truck offered by Caterpillar; larger trucks use a rigid frame system. The
ejector uses a 4 cylinder hydraulic ram and blade to dump the material out,
a similar system to Cat's wheel tractor-scrapers. The 740 Ejector is sold as
separate model from the usual 740.

Total power is 436 hp (325 kW), total operating weight is 162,280 lb

(73,610 kg), with the load being 42 short tons (38 tonnes), 37.3 yd³ (28.5
m³) at a 1:1 heap. Top forward speed is 34 mph (55 km/h).

Caterpillar 777 dump truck

The Caterpillar 777 dump truck is a model of large dump trucks, typically
used in open pit mining, manufactured by Caterpillar Inc. The truck's
capacity is 80 tones.
Caterpillar 789 dump truck
The Caterpillar 789 dump truck is a model of large dump trucks, typically
used in open pit mining, manufactured by Caterpillar Inc. The 789 has a
capacity of 195 tons, and its engine can produce 1705 horsepower.

Road roller
A road roller (sometimes called a roller-compactor, or just roller) is a
compactor type engineering vehicle used to compact soil, gravel, concrete,
or asphalt in the construction of roads and foundations.

In some parts of the world, road rollers are still known colloquially as steam
rollers, regardless of their method of propulsion. This typically only applies
to the largest examples (used for road-making).
Key Issues

• Labor strikes at Caterpillar happen frequently

• Caterpillar faces fierce competition internationally
• Caterpillar’s performance depends on the direction set by its CEO

Analysis

Caterpillar’s industry, like most manufacturing firms in the U.S., is

vulnerable to changes in world economies. Its business possesses
traditional characteristics that force the company to reform continuously to
merely survive. The company’s history has shown that throughout the past
two decades, the CEO’s leadership plays a critical role in the company’s
direction and survival in the global industry. The CEO worries about not
only the unsuitable nature of the industry but also competitors who are
trying to steal away market shares. Although constant demand of
construction tools in developing nations makes growth opportunity looks
promising in this industry, neither Caterpillar nor its competitors can stay
unworried. Firms in this industry have become adversaries that cannot
coexist; they fight for market shares to the point that they cannot slow
down. Hoping to survive, Caterpillar looks for ways to improve its products
and operations, and consequently, to build competitive advantage. To do
so, Caterpillar implements quality control measures over its distribution,
product line, dealer relations, services, and employee performance.
Caterpillar also hopes to keep its labor costs down. Its employees that are
backed by labor unions, however, do not agree. Caterpillar has
experienced more than five strikes in the past 30 years, showing a poor
record of labor relations. Caterpillar faces a dilemma because its large-
scale operations keep its labor cost high yet it cannot compromise its labor
force. The CEO’s contract signing with the UAW in 1998 shows that
Caterpillar cannot “prepare for” strikes; it has to avoid strikes.

Problem

Caterpillar has managed to reform its organizational structures and

operations, yet such reform only promises short-term survival, forcing
Caterpillar to keep looking to build more competitive advantage while
maintaining good relations with its labor force.
Recommendation
• To enter new markets, Caterpillar can do two things: 1) create a
vertical acquisition so that not only is Caterpillar providing
construction tools, but it will also be the one who signs contracts and
becomes in charge of constructions; and 2) Caterpillar should
aggressively advertise itself to governments of developing countries
because many of their construction plans are most likely controlled
by the governments.
• Caterpillar needs to invest money in research and development to
significantly expand its product line. It needs more than to simply
create products of different specifications; it needs to develop
products that are more user-friendly as well as more environmentally
friendly so that those products will not only be welcomed by users,
but they will also pass possible future regulations.
• E-commerce is no longer a means to do business but a necessity to
all businesses. Caterpillar should invest in B2B web site so that
potential buyers can go online and look at Caterpillar’s product line.
The web site would help the buyers choose the best machine for
them, and the buyers would still pick the equipment up from the
nearest dealers. Internally, Caterpillar can also set up intranet
between itself and the dealers to create more efficient
communications and better relations.
• In terms of labor relations, Caterpillar has only two choices: 1)
satisfy the wage requirements by the union and continue to
compromise; or 2) outsource its American production, whether
setting up plants in other countries, or sign manufacturing contracts
with companies in other countries. Keeping the cost down is
imperative in present time, and the ESP program won’t help much.
There is no easy way out of the labor cost struggle at this point in
time for any industry. If Caterpillar wants to keep profits positive and
high, it needs to give up producing in America.