Daily
News editor Mike Woof talks to Caterpillar CEO Doug Oberhelman
Caterpillar
CEO Doug Oberhelman said the company is benefiting from strong growth in its
operations around the world. He is confident that business will be strong in
2011 and that the firm will generate a turnover of around US$50 billion during
this financial year, similar to the record levels achieved a few years ago.
One
of the key factors in this performance is the dealer network and he said, “Our
distribution system is the best in the world.”
Business
is strong worldwide for Caterpillar while the firm’s home market is seeing
gains after several weak years and he said, “We’re seeing a slow and steady
increase in North America. The contractors and our customer base are stronger
than ever.”
The
Chinese market, in particular, forms a major part of Caterpillar’s growth
plans. He said, “We have a great plan there through to 2015.”
Caterpillar
has had a strong presence in Japan for many years and Oberhelman commented on
the impact of the massive earthquake and tsunami that devastated part of the
country. He said. “We have a big presence in Japan and we have been monitoring
events there and I can say that all 5,000 of our employees there are safe. Our
three facilities were not damaged at all by the earthquake and production
continues.”
However,
he added that there are concerns for Caterpillar’s manufacturing operations
looking ahead as component supplies could be adversely affected. He commented,
“It’s too early to say the impact on our supply chain.”
Oberhelman
explained that Caterpillar is also working with the America Red Cross on
disaster relief to Japan’s stricken areas and is supplying machines to aid in
the clean-up operations.
The
CONEXPO-CON/AGG 2011 event is an important exhibition for Caterpillar and
Oberhelman said, “We have every one of our executive officers at this show for
the first time ever. We’ve lots of new products here and one dear to my heart
is the vocational truck. I worked on that product myself. It’s something our
customers want.”
The
US$8.6 billion acquisition of mining equipment business Bucyrus International
is a major deal for Caterpillar but is still underway at present, with the
regulatory authorities evaluating the impact of the deal. Oberhelman said, “We
still have not closed that transaction but we hope to complete it this year.”
He
said the firm has an integration plan in hand but is not able to talk about the
strategy surrounding Bucyrus International until the transaction has been
closed.
Sustainability
forms a major part of Caterpillar’s future strategy, which may seem somewhat
incongruous given that the company is a construction equipment manufacturer. He
said the company has responded to legislation to reduce emissions as well as to
the debate with regard to climate change in shaping its sustainability
strategy, seeing this as a key focus for future operations.
Oberhelman
explained, “There is a simple answer. Every time we get into talks with our
customer base they ask, ‘How can you help us to be more sustainable?’”
This
request for sustainable solutions occurs with customers in the US and Europe
and also in other parts of the world, including developing markets such as
China. He said, “There is a customer demand on this all the time.”
Looking
ahead there are issues of concern for Caterpillar though and, in particular,
the current high cost of oil. Oberhelman said, “With oil at US$110/barrel,
we’re on the ragged edge and we’re watching that very closely.”
