Captain Rick: Smart companies have long range planning foresight. Caterpillar, the world’s largest earth-moving equipment manufacturer, one of America’s largest remaining manufacturing firms and listed on the Dow Jones Index is one such company. As a mechanical engineer, I followed the trail of this great company over the past half century.
Caterpillar’s CEO Douglas Oberhelman announced at an industry conference in Las Vegas on Monday that the economic slowdown has been sharper than the company anticipated. I suspect much of this relates to the significant manufacturing slowdown in China, as a result of shrinking economies in Europe and the U.S. As I reported in my blog entry on September 19, 2012, Caterpillar over estimated potential growth in China and made significant production cutbacks at its Chinese excavator plant. Monday’s announcement caused Caterpillar’s stock to slide to 87, a 7.42% loss year to date. I applaud Caterpillar for keeping a realistic eye on the future, considering the serious economic challenges facing our world.