How has Caterpillar successfully fought international competition?
A midwest manufacturing company, fat and lazy, heavily unionized, suddenly faces foreign competition. You know the ending: massive layoffs, closed factories, consolidation, rumblings of bankruptcy.
That's the familiar story of General Motors, Ford and lots of other big manufacturers over the last 20 or 30 years. And then there's Caterpillar in Peoria, Illinois, as Rust Belt as one can get, making those big yellow earthmoving machines and the engines that power 18-wheelers, hospitals and container ships. Profit last year rose 40%, to $2.9 billion, on a 20% gain in revenue, to $36.3 billion. This year the company should haul in $40 billion, half from abroad, says Chief Executive Jim W. Owens. No layoffs are in sight. Caterpillar's workforce has climbed 23%, to 85,000, in the last two years. You'll have to wait 12 months to get your hands on one of its mining dump trucks, the ones that can hold up to 400 tons of ore. No wait for the Ford Freestyle. Cat shares have more than tripled in the last five years while the S&P500 has declined 6.3%.
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[Hat tip: www.thestalwart.com ]
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