Caterpillar Inc.

Caterpillar Inc.
	Caterpillar logo
Company type	Public (NYSE: CAT)
Industry	Heavy equipment
Founded	1925
Headquarters	Peoria, Illinois, USA
Key people	James W. Owens, CEO & Chairman
Products	Construction & Agriculture Machinery
Revenue	$41.517 billion USD (2006) [1]
Operating income	7,904,000,000 United States dollar (2022)
Net income	$3.537billion USD (2006) [2]
Total assets	78,509,000,000 United States dollar (2018)
Number of employees	85,116
Website	http://www.cat.com/

Caterpillar Inc. NYSE: 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 (which is a special pigment titled "Caterpillar Yellow," as featured on an episode of American Chopper), Caterpillar produces a wide range of heavy equipment, mainly engineering vehicles, including the Caterpillar D9 bulldozer.

Caterpillar is one of 30 companies whose stock is tracked in the Dow Jones Industrial Average. It is a Fortune 100 company ranked first in its industry, with more than $30 billion in assets.

President Bush recently visited Caterpillar in East Peoria, Illinois on January 30, 2007. The President commended Caterpillar for successfully demonstrating that U.S. companies can continue to successfully compete on the world stage.

History

The story of Caterpillar Inc. originates in the late nineteenth 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 California soil, especially after heavy rains. These huge tractors were difficult to pull free, even with teams of horses. Benjamin Holt had an idea: why not carry the road with the vehicle? On November 24 1904 he added wooden block-linked treads around the idlers on Holt No.77, his test tractor. The results were impressive, and the modern tractor was born. Caterpillar became famous for its Caterpillar 30 and its Caterpillar 60 tractors.

Caterpillar formed 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 $13 million. By 1929, sales climbed to $52.8 million, and CAT continued to grow throughout the Depression of the 1930s. The Holt Manufacturing Company had earlier pioneered the use of the caterpillar track during World War I.

After the companies merged, Caterpillar went through many changes, including the adoption of the diesel engine. Caterpillar products found fame with the US Navy "Seabees" who built airfields in the Pacific War. Following World War II, the company grew at a rapid pace and launched its first venture outside the US in 1950, marking the beginning of Caterpillar's development into a multinational corporation.

Caterpillar products range from track-type tractors to hydraulic excavators, backhoe loaders, motor graders, off-highway trucks, wheel loaders, agricultural tractors, diesel and natural gas engines and gas turbines. They are used in construction, road-building, mining, forestry, energy, transportation and material-handling industries.

Caterpillar's crawler tractors inspired the first military tanks, which helped end World War I. Many of their machines helped build the Hoover Dam, tunnel under the English Channel, tumble the Berlin Wall and construct cities and neighborhoods across the United States.

Caterpillar was one of the "excellent" companies featured in the 1982 best-selling management book In Search of Excellence, by business management guru Tom Peters. The company is guided by the principles of their "Worldwide Code of Conduct" document that stresses integrity in every action.[3]

Corporate governance

Current board of directors

Sales and facilities

44% (current as of 1Q2006) 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 42 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.

Although Caterpillar has "farmed out" much of its 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.

The Caterpillar Defence Products subsidiary, headquartered in Shrewsbury, Shropshire, provides diesel engines, automatic transmissions and other parts for the UK's Titan and Trojan engineer tanks, Terrier combat engineer vehicles, and tank transporters; the Romanian MLI-84 armored personnel carrier and the Swiss Piranha III light armored vehicle, which is currently being developed for American light armored formations; large fleets of military trucks in both the US and UK; and the CV90 family of infantry fighting vehicles used by the armies of Sweden, Norway, Finland, Switzerland, the Netherlands and Denmark.

Caterpillar Defence Products also provides both propulsion engines and power generation systems to the naval shipbuilding industry, supplying the American Virginia-class nuclear submarines and San Antonio-class amphibious transport docks; the Spanish Alvaro de Bazán-class frigates; the British River-class offshore patrol vessels; the Malaysian A-100 type offshore patrol vessels; and the Mexican Justo Sierra Mendez-class gunships. [4]

The Russian Caterpillar facility was completed in 16 months and occupied in November of 1999. It had the first electrical substation built in the Leningrad Oblast Region since the Communist government was dissolved on December 26, 1991. The facility was built under harsh winter conditions, where the temperature exceeded -25°C.

Employment

Caterpillar’s worldwide employment was 93,233 in third quarter 2006, up 9,334 from 83,899 in third quarter 2005. Of the increase, about 5,200 was a result of acquisitions, and about 1,900 hourly and 2,200 salaried and management employees were added to support higher volume and new product introductions. The increase related to acquisitions was for Progress Rail and a logistics business in Europe. According to a 2001 article [5] in the Nashville Business Journal, 60% of Caterpillar's employees work outside the United States.

Controversies

Israeli use

File:D9R-idf.jpg

Two armored IDF D9R bulldozers. These are Caterpillar D9R bulldozers, up-armored by Israeli industries. They are used for combat engineering and have gained notoriety for their use in urban warfare in the conflict with the Palestinians.

Israel Defense Forces bulldozers are Caterpillar tractors (bulldozer, excavator and wheel loader) which are armored by Israeli industries and used for combat engineering applications. The most notable dozer is the Caterpillar D9, which is used for counter-terrorism operations in the West Bank and the Gaza Strip, operations which often include the demolitions of buildings and clearance of shrubbery.

A coalition of groups[6], led by the Jewish Voice for Peace - an organization termed by some American Jewish groups as being "anti-Israel" [7] - has called for protests against the sales of Caterpillar bulldozers to Israel, claiming the use of the equipment in the demolishing of the homes of Palestinian residents, the destruction of olive groves, and the death of American protestor Rachel Corrie while trying to obstruct such activities, and alleging that Caterpillar profits from the construction of the Israeli West Bank barrier. Some human rights groups, such as Amnesty International also have criticized the Israeli usage of bulldozers. [8]

JVP and a group of Presbyterian churches raised a motion in Caterpillar's Annual Shareholders' Conference to review and also cancel the sales of equipment to Israel. The motion was rejected 97% to 3%. Caterpillar maintains it has no right or means to monitor how its equipment is being used.

In February 2006, the General Synod of the Church of England voted overwhelmingly to divest its $2.2 million of stocks in Caterpillar Inc. As what they claim to be an ethical statement: " against the destruction of 4,000 Palestinian homes, the deliberate uprooting of 1,000,000 olive trees and the construction of the wall between Israel and the West Bank".^{[citation needed]}

Labor problems

Caterpillar almost went under in the early 1980s, due to massive labor union strikes and a downturn in product demand. Several news reports at the time indicated that products were piling up so high in facilities that temporary workers hired to work the lines could barely make their way to their work stations. Caterpillar suffered another long labor disagreement in the 1990s, in which the company hired what it termed "permanent replacements" for locked out union workers.

In both situations, jack rocks were placed in the home driveways of many Caterpillar executives and employees, puncturing tires of vehicles and further increasing tensions between company heads and laborers. Caterpillar's response to these conflicts with the union was to "farm out" much of its parts production and warehouse work to outside firms: rather than fighting the union, Caterpillar has made itself less vulnerable to the union. This has cost nearly 20,000 high-wage union jobs in the Peoria area, but Caterpillar has survived and grown stronger.

Not long after the 1990s situation was resolved and the economy started to pick up again, Caterpillar adopted the "6 Sigma" quality management program, so as to reduce costs and inventory, and identify and correct defects in the company's processes and products.

Environment

Caterpillar has been under fire by many environmental groups. Products produced by the company include tree logging trucks, strip and under-ground mining equipment, and of course, diesel engines. In 2004, the company came out with "ACERT" diesel engines that exceed federal guidelines for emission standards.

In 2005, Caterpillar donated millions of dollars to The Nature Conservancy in a joint effort to protect and preserve river systems in Brazil, USA, and China.

In 2006, the company issued its first annual Sustainability Report, touting its remanufacturing, recycling, and environmental projects around the world. This report can be found on their website.

Caterpillar has for many years been a member of the World Business Council for Sustainable Development (WBCSD), based in Geneva, Switzerland. In 2005, Cat expressed a strong commitment to sustainability.

External links

Official Caterpillar website
Caterpillar: the Alternative Report - War On Want alternative report about Caterpillar social responsibility policy