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Caterpillar Shocker: Industrial Bellweather To Fire Up to 10,000; Slashes Revenue Outlook
Just three days ago after looking at the latest CAT retail sales, we asked in stunned amazement "What On Earth Is Going On With Caterpillar Sales?" and showed the following two charts:
We now know the answer. The company was merely preparing to shock its investors with a $1.5 billion cost-cutting announcement, which includes the firing of as much as 10,000 people through 2018. Far worse, however, is the company finally admitting that it can no longer pretend reality does not exist, and cut its revenue outlook by 5% with the admission that "2016 would mark the first time in Caterpillar's 90-year history that sales and revenues have decreased four years in a row."
Of course, our readers already knew that.
From the ironically titled "Building for a Stronger Future" press release:
Caterpillar Inc. (CAT) today announced significant restructuring and cost reduction actions that are expected to lower operating costs by about $1.5 billion annually once fully implemented. The cost reduction steps will begin in late 2015 and reflect recent, current and expected market conditions. For 2015, the company's sales and revenues outlook has weakened, with 2015 sales and revenues now expected to be about $48 billion, or $1 billion lower than the previous outlook of about $49 billion. For 2016, sales and revenues are expected to be about 5 percent below 2015.
PEORIA, Ill., Sept. 24, 2015 /PRNewswire/ -- Caterpillar Inc. (CAT) today announced significant restructuring and cost reduction actions that are expected to lower operating costs by about $1.5 billion annually once fully implemented. The cost reduction steps will begin in late 2015 and reflect recent, current and expected market conditions. For 2015, the company's sales and revenues outlook has weakened, with 2015 sales and revenues now expected to be about $48 billion, or $1 billion lower than the previous outlook of about $49 billion. For 2016, sales and revenues are expected to be about 5 percent below 2015.
Key steps planned by the company include:
- An expected permanent reduction in Caterpillar's salaried and management workforce, including agency, of 4,000 – 5,000 people between now and the end of 2016, with most occurring in 2015, and with a total possible workforce reduction of more than 10,000 people, including the contemplated consolidation and closures of manufacturing facilities occurring through 2018.
- The company will offer a voluntary retirement enhancement program for qualifying employees, which will be completed by the end of 2015.
- Slightly less than half of the $1.5 billion of cost reduction is expected to be from lower Selling, General and Administrative (SG&A) costs. The reduction in SG&A will largely be in place and effective in 2016 and occur across the company.
- The remaining cost reductions are expected to come from lower period manufacturing costs, including savings from additional contemplated facility consolidations and closures, which could impact more than 20 facilities and slightly more than 10 percent of our manufacturing square footage. A portion of these cost reductions are expected to be effective in 2016, with more savings anticipated in 2017 and 2018.
"We are facing a convergence of challenging marketplace conditions in key regions and industry sectors – namely in mining and energy," said Doug Oberhelman, Caterpillar Chairman and CEO. "While we've already made substantial adjustments as these market conditions have emerged, we are taking even more decisive actions now. We don't make these decisions lightly, but I'm confident these additional steps will better position Caterpillar to deliver solid results when demand improves."
This year is the company's third consecutive down year for sales and revenues, and 2016 would mark the first time in Caterpillar's 90-year history that sales and revenues have decreased four years in a row.
"Our strategy is to deliver superior total shareholder returns through the business cycle, and growth is a key element of that strategy. However, several of the key industries we serve – including mining, oil and gas, construction and rail – have a long history of substantial cyclicality. While they are the right businesses to be in for the long term, we have to manage through what can be considerable and sometimes prolonged downturns," added Oberhelman.
Today's announcement is in addition to significant actions already taken. Since 2013, Caterpillar has closed or announced plans to close or consolidate more than 20 facilities, impacting 8 million square feet of manufacturing space. The company has also reduced its total workforce by more than 31,000 since mid-2012.
"We recognize today's news and actions taken in recent years are difficult for our employees, their families and the communities where we're located. We have a talented and dedicated workforce, and we know this will be hard for them," said Oberhelman.
While Caterpillar has taken action in response to macro-economic challenges, it has remained focused on strategy execution – and that has driven positive operational results, including:
- Market share has improved in products across much of the company.
- The company has delivered on decremental profit pull through targets as Lean manufacturing has driven its 2015 gross margin rate higher, and it is right in line with its highest level in 20 years.
- Product quality is as good as it has been in Caterpillar's history.
- Today, Caterpillar safety levels are among the best for heavy manufacturers.
"Operational improvements have contributed to our strong balance sheet and cash flow. In fact, three of our four best years of Machinery, Energy & Transportation (ME&T) operating cash flow have occurred since 2011 – at the same time sales and revenues have been under pressure. That's driven substantial improvement in our quarterly dividend. Our dividend increased 15 percent in 2013, 17 percent in 2014 and 10 percent in 2015. That's enabled $8.2 billion of share repurchases over the past three years," said Oberhelman.
Pre-tax costs associated with these actions are expected to be about $2 billion for employee-related severance and other termination benefits, and other exit-related costs associated with the consolidation of manufacturing facilities.
Following are questions and answers related to today's announcement:
Q1: Can you be more specific about which manufacturing facilities are being consolidated and/or closed? Which of your businesses are affected? What regions of the world will be impacted?
A: We are contemplating restructuring actions that could impact more than 20 facilities around the world and across our three large segments – Construction Industries, Resource Industries and Energy & Transportation. There are many factors that impact these contemplated decisions and the subsequent timing of when each would be announced and implemented. Employees will be notified as decisions are made for each facility.
Q2: You've updated your 2015 outlook for sales and revenues, but not for profit. Can you provide more context on 2015 profit?
A: We are lowering the 2015 sales and revenues outlook to about $48 billion, which is about $1 billion lower than our previous outlook of about $49 billion. The $1 billion decline is a result of broadly weaker business conditions across our three large segments – Construction Industries, Energy & Transportation and Resource Industries. The $1 billion decline is expected to impact both the third and fourth quarters of 2015.
We will provide an update of the 2015 profit outlook with our third-quarter financial release in late October. That said, the decline in the sales outlook and higher restructuring costs as a result of today's announcement will be negative for profit. On the positive side, we expect that costs (not including restructuring costs) will be favorable. Over the next few weeks, we will have a better view of how these factors, particularly restructuring costs, will impact 2015 profit.
Q3: You typically provide a preliminary outlook of the following year in your third-quarter financial release. It seems as though you've done that in today's announcement. Why have you done that earlier than normal?
A: We started our planning process earlier than usual due to the convergence of challenging marketplace conditions our business is facing. At this point, we are experiencing continued weakness in key industries that we serve. We expect that will lead to our fourth consecutive year of sales decline, with our sales and revenues down about 5 percent in 2016 versus 2015. We currently expect the decline in sales and revenues in 2016 will occur in all three of our large segments – Construction Industries, Energy & Transportation and Resource Industries – with the most significant decline in the oil and gas portion of our Energy and Transportation segment. With the continuing decline in sales, it was appropriate to take the additional restructuring and cost reduction actions that were announced today, and issuing next year's preliminary sales and revenues outlook provided additional context for today's restructuring announcement.
Q4: While you usually provide next year's profit outlook in January, is there any context you can provide to help put 2016 profit in perspective?
A: We have more work to do to complete our profit plan for 2016 and to understand how today's announcement affects each of our businesses. That said, there are three directional points related to 2016 profit that are noteworthy – two negative to profit versus 2015 and one that we expect to be positive. On the negative side, 2015 had a gain on the sale of our remaining ownership of our third-party logistics business that helped profit in 2015 by about $0.14 per share; that will not repeat in 2016. Second, the sales decline in 2016 (about 5 percent) is expected to be concentrated in relatively higher margin products, so the impact of sales mix is expected to be unfavorable about $500 million. On the positive side for profit, we expect that about half of the cost reduction expected from the restructuring actions in today's release ($1.5 billion) will be effective in 2016. We expect to provide an updated outlook for sales and revenues and a profit outlook for 2016 in more detail with our year-end financial release in January.
Q5: Does today's announcement reflect a change in your long-term view of the key industries you serve – construction, mining, oil and gas, etc.?
A: Many of the key industries we serve have a long history of substantial cyclicality and are currently well below prior peak levels. For example, mining equipment sales are far below the prior peak and are substantially below what we would consider a reasonable replacement level. Oil and gas has declined substantially as a result of lower oil prices, and construction equipment sales are well below prior peaks in North America, Latin America, Europe, Africa, the Middle East and Asia Pacific. As the world economy improves, we strongly believe the need for Cat® products and services for infrastructure, mining, commodities, energy and transportation will improve. With the actions we've taken over the past few years, along with the restructuring announced today, we believe Caterpillar will be well positioned to deliver solid results when these industries recover and demand improves.
* * *
No more dead CAT bounces: the stock is tumbling on the "news".
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There's no such word as "bellweather" used in this sense. But then again, if this trend continues, there will be no such company as Caterpillar.
Shovel ready.....wasn't so shovel ready.
Quick someone give them a printing press!
Shite sales team
At least Caterpiller aren't gasing people, unlike VW. Thosebloody Germans are at it again!
We are so far from a recovery
Layoff / Closing List: http://www.dailyjobcuts.com
-
Don't worry, they'll make excellent waiters.
Cat needs to move out of Illinois to a more business friendly state.
If you are in a country that doesn't build anything any more, you don't need any machines that build things either.
So Caterpillar put a lot of their chips on China. Bad bet.
Will they survive? Probably. But they'll end up a lot smaller. What these guys really need is a good war to help their revenues. Not those little dust-ups in the mideast- a REAL war. Flattened cities and that sort of stuff. The kind of war that requires a big rebuilding effort when it's over.
They'll be shitting in tall cotton when the governement orders thousands of up armored caged people scoops ala Soylent Green, to move all the "little people" into the FEMA camps lol.
Shovel ready and dogs - worth repeating:
https://www.youtube.com/watch?v=sZY-MZROgc4
Also what I heard from a high level manager long ago:
"First rule of holes: When you are in one, stop digging."
CAT should have the equipment around to fill the one they have dug for themselves... If not, there are always stock buybacks, and for that - there is DEBT (aka ZIRP!!). (was some credit card bugger or other)
CAT tractors have been used to flatten Palestinian homes and the farms of Americans during the great depression.
Surprising that such utile equipment isn't selling.
Dude, this is an Obama recovery. Layoffs are a good thing as there are so many jobs open and we need these people to fill those positions!!!!
Everything things is mutha-trucking awesome!
Caterpillar is in Illinois. Land of Lincoln (who started a war against his own people) and Obola (who started many wars including against the Americans which he is not).
Maybe Caterpillar should move out of that high tax shithole in IL.
Caterpillar builds a new plant in texas somewhere. hope they still have enough capital to do it.
The recovery is here! Lift-off! Time to raise rates Yellen!
Caterpillar cuts 10,000, HP cuts 30,000, no one needs to work!
Send us our checks for $6 Million each! We'll tip the wait staff and bartenders!
Yeah, but just think of the opportunity these people now have to focus on their art and music! (Hat tip to Imelda Pelosi)
Nancy Pelosi (D-Calif.) said Thursday that Obamacare facilitates the type of “liberation” that the “Founders had in mind” because it allows you to quit your job and become a “photographer,” a “writer,” a “musician”--or “whatever.”
“As you hear from these stories, this is a liberation,” Pelosi said at a Capitol Hill news conference Thursday.
“This is what our founders had in mind--ever expanding opportunity for people.
“You want to be a photographer or a writer or a musician, whatever -- an artist, you wa
Meanwhile, #deglobalization continues....
Deutsche bank has confirmed closure of Russian operations.
http://www.sputniknews.com/business/20150923/1027423887/deutsche-bank-of...
Ballarpur from India is selling it's Malaysian operations.
http://www.business-standard.com/article/companies/bilt-to-sell-its-mala...
RBS from UK has sold the last of it's Indian operations.
http://in.reuters.com/article/2015/09/24/royal-bank-scot-india-wealth-id...
Ailing steelmaker SSI halts UK production; 2,000 jobs at risk News in numbers | Vedanta Group cuts 4,000 jobs in India since JanuaryChina’s Shift Away From Industry Drains Life From a Steel Town
Deglobalization is not just an economic issue. Here is a very interesting but unsettling analysis of the phenomenon, by Koert Debeuf:
https://medium.com/@koertdebeuf/tribalization-d6446b5301ed
Very interesting read...will read more later...but the snippets that I read echo my own thoughts for the last 2-3 years.
I have been advocating the major trend of deglobalization that will disrupt socities and create more unemployment and make us more resilient though economically feeble. However, we will be more nationalistic and more patriotic in the years ahead as rascism continues to rise and animosity between religions reaches epic propritions.
But the root cause of everything is over population and the deglobalization trend that started a few years ago.
Mitsubishi Motors in US calls it a dayRead more: http://www.vcpost.com/articles/93107/20150921/mitsubishi-motors-calls-day.htm#ixzz3mfIAMpm8
If every nation wishes to just export and produce more, then my question is: who is importing those excess goods??
We are disintegrating our societies to the extent of an implosion on the economic and societal, religious and cultural fronts. Very few countries who can recognise these trends will make it intact over the next decade or they shoud lbe insulated like China, Russia etc from foreign influences or must have the capcity to undergo this stomach churning process. Most nations will disintegrate due to economic, terror related or whatever causes them to implode due to deglobalization.
America is a great example on the oil front to have caused deglobalization. Until 9/11 America used to buy a lot of oil from Nigeria, Saudi, Middle East etc. Then it stopped and started buyng from friends in Canada, UK etc. Now it has even stopped from those and is self reliant which is why it is causing chaos everywhere with low oil prices and is just watching the fun!
Unfortunately, America is isolated now on the one end. 249 countries, for some reason or another are stacked against it.
This attitude of do or die by America will bring it down to its knees as the Top 10 countries like China, Russia, India, Pakistan, Iran, Latin America etc continue to come closer every passing day and have mutual respect for each other.
America will have a lot of troubles in the years to come where no one will want to help or be with America. This is already attested by the massive decline opf Top 500 companies in the world. America had over 400 companies in this group, 2 decades ago, but today is close to 100. Same with USD as more and more countries continue to abandon their trade with US or via the USD.
All these deglobalization trends will have consequences and many small countries will have no choice but to become more nationalistic, more deglobalized (and produce more themselves) and collaborate with countries that are growing!
Interesting read. He obviously is in favor of increased and continued globalization, and has his own slant on some events while ignoring others, but at least a clear-eyed look at tribalism, a subject I have harped about for years.
Globalization and immigration are causing untold problems around the world, and trying to wring the tribalism out of humanity will be a losing game long-term. We are all instinctively tribal. It is visible in the day-to-day activities of even the most sophisticated and intelligent among us. That is why we gravitate to "my school", "my sports team", "my Church", "my club"....that place where I feel I belong, where it's warm and comforting and insular.
That is not going to change. As things get worse economically, immigrants and anyone else identified as "the other", will become ever more marginalized. Increased Nationalism is inevitable. Trying to pretend and hold it back will be futile. Humanity is only capable of evolving so far over blocks of time, and also tends to slide backwards toward barbarism from time to time. Tribalism is what allowed humanity to band together and evolve. It is innate, a part of our DNA, and it is not going away, no matter how hard misguided social and political leaders try to shove it down our collective throats.
The E.P.A. and the D.O.J. are just going after non-American automakers.
When they're done with the foreign makes they'll go after Ford because they were the only U.S. automaker not to get a bail out from the taxpayer.
Does anyone know why Yellen is speaking today? Was this scheduled? Is this an emergecey announcement?
Scheduled and normal.
Google is your friend.
So, you don't know either.
(google is your friend is the biggest internet cop-out evah)
How true...
Google's inventors were given major money from the CIA in the early stages. the CIA quickly saw the potential of what the inventors of google were doing. If I remember correctly from my reading the inventers actually worked for the cia.
Just google it!
It's hard to say just which companies are going to survive the coming socio-economic paroxysm. I suspect even the most knowledgeable pundits will be greatly surprised when things finally get shaken out. None of the multi-nationals will be left unscathed.
If you're living in one of the major metropolitan areas, I strongly suggest you consider finding quieter surroundings,,,
;-D
I already have the quiet surroundings covered. As for surviving companies, the more buyback debt they take on, the less chance for survival. CAT might make it, but as a much smaller company.....
Komatsu is beating Caterpillar in the marketplace. Maybe Caterpiller should merge with Komatsu. Follow the Pfizer example, which is buy up companies that have blockbuster drugs that customers will buy. Customers now seem to favor Komatsu. Borrow a ton of Fed QE money and buy it, Caterpillar!
When you buy a Japanese company that belongs to a keiretsu you never know what is worth. With the "sogo shosha" operating system and it's thin margins, you never know if the company makes money or not. Between the banks that protect each keiretsu and the cross owning of all subsidiaries and keiretsu members you can never know the true value and your due diligence will be totally distorted.
Good luck buying a Japanese company...
Or Chinese, or [insert leftist hell-hole country here]
There is serious competition out there and the USD strength which is killing exports.
USD to CAD is 1.34 this morning. That 34 cents difference would steer me to an Asian brand as their quality is good and Cat is not worth the difference.
this will not help Illinois tax revenues
... especially when they finally make the right decision and move hq to Texas
None of this matters as i heard a guy (newbie, or is it sucker) on FBN say this was time to buy. And someone said if old Yeller raises rates stocks would go up????? Maybe they are passing out mushrooms in the green room?
2 in the pink and 1 in the stink is The Shocker. This is a lazy company that got caught by aggressive rivals in China and India. And maybe some are afraid of the equipment having U.S. spy software built in. Wouldn't it be cool if you go to war with a country and have the ability to disable all of its construction equipment.
Who needs CAT when you can only afford a shovel ?
Plus I am SHOCKED.....SHOCKED I tell ya' that no one saw this coming. Even ZeroHedge which is pretty good about such things........oh.....wait.
I hate CAT and I hope they go bankrupt!
Spare not a thought for the 10.000 people who are about to lose their source of income.
Well if people understood what sound money was and banker fraud none of this would happen.
Wait, I though firing people was good for the bottom line. How can the stock be down?
where is carly's involvement in this?
Soon institutions will be selling MCD as well to rebalance their portfolios.
Decreasing radius spiral is natural, right?
Yes and when you fire them don't you announce a stock buyback?
Wow, a comment from you where you're not calling everyone racist. Refreshing.
Wait until they fire a Muslim....
Bleeding heart? LOL
I like CAT equipment but hate their F'ing unions and sycophant relationship with the left
But they do sponsor a team in the politically correct NASCAR, so they've got that going for them. Or not.
I stopped watching NASCAR as anything other than mindless entertainment when they dumped Winston and gave up on stock-bodied cars. Not much better than WWE in my opinion.
But wimmin can drive fast too!
NFLMLBNBANHL......It's all Monday Night Rehabilitation.
Buttfuckers!
Yeah, but it's payaing off for them so......
Yes,,, things will definitely improve when were all making $10/week.
No problem with unions that do not depend on political cronyism or tax dollars to survive.- - very few of these.
When political graft and government (tax dollars from citizens paychecks) produces the 'jobs', pensions and bailouts I have a problem with that. i.e. GM, CAT, GE, Postal Service any Government related activity as it spends citizens paychecks.
Better than making $0 which is what 10,000 former CAT employees will be doing soon.
Not to worry, in Obama's America we just have to wait for the unemployment rate toimprove, once these 10,000 workers drop out of the system because they are fed up with trying to find real jobs that aren't there.
And best news yet, inflation will go down once they remove health insurance costs from the CPI calculations, just like food & energy. Because only haters eat and burn fuel.
Everything will be fine, you'll see!
Yes if we got rid of the unions, everything would be gumdrops and lolly pops, then we all could pretend inflation doesn't exist while we work 7 days a week at less than minimum wage. We will be back to burning women and children alive in sweat shops in no time. Luckily politicians (right and left) and bankers remain the epitome of honesty and integerty after the crooked unions, and colective barganing are extinct. And the race to the bottom will magically leave us on top. Seems legit.
Perhaps it is just me, but that really does not look bullish (even if one is drinking a lot).
Lie on your side while viewing the screen
"substantial cyclicality"
Look away.
This data must be lies - we are in a recovery.
Praise 0bama the Destructor.
And 3...2...1... before some clown replies with "do you really think anything would be different under Romney"...
Invoking Bushes fault.......infinity!
Morpheus had it right when he told Mr. Smith, "You all look the same to me."
Federal, State, and Local, - - - ALL CUT FROM THE SAME CLOTH.
Safe, safe boobie safe safe safe
Soft, soft boobie soft soft soft
Secure, secure boobie in a bra bra bra
We're all boobs now,,,
;-D
We're all boobies now...and I, for one, have been squeezed way too much.
+1 to ZH. You were calling out Cat even before the layoffs.
+1,000....there, fixed it for you.
I had a conversation with a Toyota exec yesterday. He said they were expanding like crazy, buying up warehousing and plants in south Texas. I told him about CAT, 33 months of bad sales, etc.. He said he thought CAT would be fine and that according to his company, the economy was picking up. I then asked him if he knew what the term 'channel stuffing' meant.
Silence.
Once again, the Hedge is on the cutting edge.
Does anyone post only 'Prime' end-user car sales?
Shovel Ready!!!!!!!!!!!!!!!!!!!!
What the fuck does "shovel ready" even mean? Sure, even I will admit it was a great sound byte to the fawning masses of Obama voters, but the shovel doesn't wake up in the morning and report to work. They don't just station themselves next to a hole in the ground, waiting for twenty union laborers to show up and stand around the abyss. Is that "shovel ready"? Obama would only give a shovel to his supporters anyway, but NONE of them even know what a freaking shovel looks like! Do you just throw a few shovels around a job site and call it "work"? Do you pay the people that show up to look at the shovels lying on the ground? One shovel probably has more economic output than five hundred Obama supporters, maybe more. This has been pissing me off for a long time.
I've never seen one man say so much, to so many, by saying so little. But somehow this works in the US.
The term refers to capital improvement and maintenance projects that have been designed and planned, but were just in need of funding.
Sure enough, that phrase just triggers my political Turrets syndrome. But I'll bet 100 upvotes that someone just handed Obama a shovel and a note card as he stepped up to the podium and said that. Now it's going to take me all day to forget "shovel ready" for another week or so, until it strikes again.
The phrases "Mission Accomplished" and "I did not have sexual relations with that woman" have a similar effect.
"Shovel ready" went the way of Oblammy's white mother
"Shovel ready" went the way of Oblammy's white mother
https://www.opensecrets.org/lobby/clientsum.php?id=D000000352
They probably should be lobbying harder. Can't Yellen just buy tractors?
Lets raise rates and finish off this circus. Or we can keep them at ZIRP and eat ourselves.
Don't worry. This is more about high quality competition taking CAT's marketshare than about some global economic catastrophy. Kubota, Kumatsu and Hitachi have quickly created some stiff competition for CAT. CAT equipment is relatively high cost and expensive to operate and maintain compaired to its competitors. Take the opportunity to pick up some stock in KUBTY, KMTUY and HTHIY. Don't worry, just profit!
In the linked previous CAT blog post somebody linked to Kumatsu's data. It did not look much better then CAT's, lots of negative numbers. They also seemed to have stopped posting there numbers, also not a good sign.
Anyone who reads this site frequently and cannot see that the world is shutting down and not knowing the reasons why must be reading with their eyes closed.
After connecting the many dots...one can see how this slowdown could have been predictable. This phony Fiat monetary system that the bankers "thieves" have created needs the total monetary system to expand continuously or else it will collapse upon itself. More debt money needs to be created every day forever or the system collapses (The debt HAS to be larger than the money in existence). With the baby boombers getting older and ceasing there large purchases or even selling their largest purchase ie their house and having no more debt, it is left up to the generation under the boomers to continue the spending spree of the boomers. This cannot happen due to the demographics of the situation. Think of the baby boomers as a bulge going through a garden house as if something was in the hose ie a rat. Once the rat has been pushed throught the hose there is no more bulge.This is a big part of what is happening. The hose is now back to the size before the boomers arrived, but the economy needs the spending of an ever increasing population or it implodes. Couple this need with the fact we live on a finite planet of resources which are running thin and we have very large over spendings .gov's that do not want to cut spending one little bit.
Now do you see the problem?
There are only three ways out in my opinion;
Komatsu and Hitachi are more popular these days as they're as good but cheaper.
So, yet another industry where America cannot compete?
Komatsu and Hitachi are more popular these days as they're as good but cheaper.
They are certainly cheaper but the quality and service life of both companies products is not near CAT products. CAT still is the defacto standard for heavy construction and mining equipment.
I agree that this trendline is bad news for CAT, but on the other hand, they are still selling on average almost $1Billion per week.
They have been in the red since the tier 4 emmision standard, and sinking slowly, soon all they will be selling is hats, shirts, and parts for the pre tier 4 machines that everyone will keep even longer. Short Cat and John Deere.
Unemployment rate will miraculously fall to 4.9% in exceptional America.
Pravda/US
"I can announce today our employment rate is 98%"
---Bath House Barry
Those Caterpillars seem to be just crawlin now.
I hope they don't do layoffs in my state; we have too many obamaphones now.
I passed by a tent one day and people were getting two or three phones.
You can't get an Obamaphone around here unless you're some shade of brown.
Since we plan on taking in many more migrants it will be a lot cheaper to hand out shovels for the shovel ready jobs instead of purchasing heavy equipment. If you already need to feed and house the migrants you might want to throw in a few more dollars for them to shovel.
BUTTerfly stock should go through the roof.
Why doesn't the U.S. Government put Caterpiller to work in order to clean up 40 square miles of run down polluted industrial wasteland surrounding Detroit?Politicians sold out to Communists in order to get them to fund their debt for war.Years ago they were called traitors.Pitiful.
If we want a construction recovery, we need to bomb China's Ghost cities ...
Unwanted and expensive American engineering that can't compete on the world stage.
Harley Davidson would be in the same shape without the loyalty it doesn't deserve.
What is the big surprise?
Humans have reached, "Peak Stuff."
They have been pushed into spending, Spend! Spend! Spend! for so long that their brains are imploding.
I'm sure that the $1.5 billion in savings will be applied to their next stock buyback...
As the principle architect of the downing of Bear Stearns, Lehman Bros, and the United States of America, I can assure all that there will be no recovery for centuries let alone decades, or years. Oberhelman will find optimism in the prospect of his own suicide, but he ain't going to find it in markets, or the future. In brief, the future does not belong to rich Jews, or rich Roman Catholics.
Buy a fucking clue, Oberhelman. The days of the Jew being on top are over, motherfucker.
They would be in serious trouble if the economy was doing poorly...
Hope & change!!!
Hope & change!!!
Stock buyback now?
"when demand increases" like in 20 years from now when all us baby boomers are dead and uthanized and buried.
10K is just a drop in the worldwide wreckovery bit bucket.
"We recognize today's news and actions taken in recent years are difficult for our employees, their families and the communities where we're located. We have a talented and dedicated workforce, and we know this will be hard for them," said Oberhelman."
So...now what?
They gave the company a quality product and showed loyalty, and now, after a "severance"...what are THEY supposed to do?
How about adding "worker retraining and affirmative placement" costs to your downsizing plans?
Forget unemployment insurance contributions as a means of avoiding this responsibility (and YES, it IS your responsibility to this "talented and dedicated workforce").
Part of a paycheck for a while isn't a new career and a new future.
It doesn't do much to help the country that bore you either...
m
Welcome to funemployment! Until other people's money runs out.
Yerr Fuirred!
The irony. And the idiots will still line up to vote for a mechanical turk.
All domestic.
Hope and change flushed down the toilet.
Christmas may not be merry in Peoria. The land of the brave and home of the free needs help.
Christmas? Whats that?
Oh! You mean the "great spending spree" to help pull wall street thru the winter months.
Born and raised in Peoria, going back for TG with provisions of dried kale, quinoa and hash oil.
Peoria treads water in the best of times; there has been a permafrost on the economy since the start of the Rust Belt days. RRE values in the city have not moved since the 1990s.
I'm wincing at this news because 10,000 jobs translates to 20,000 when you factor in corollary employment, RE values, et cetera. The city imploded years ago, white flight to the suburbs north and now you have 'No Guns' signs on the door at Jimmy Dean's. The story of flyover country, writ large.
The 'poor' 10,000 people in a company which no longer matters. Bail them out like GM.
COME ON Caterpillar - moving DIRT is SO old-fashioned - you NEED to move stuff like CDO's....
I said when this downturn started - this is a BEAR market. Keep your eyes open for large layoffs. Now we've got HP firing 30,000 people, and Caterpillar firing 10,000. Just the start ...
I'm going to have females oil wrestle in my basement for bologna sandwiches.
CAT is in Indiana and it is VERY business friendly. Business friendly don't mena shit without orders. John Deere is in illinois and they have shit for luck too.
The US government sabotaged Cat by destroying the coal industry with bullshit global warming regulation and kicking off and then collapsing the shale boom. Coal mining is where you are going to find the majority of the largest equipment in the world. Coal was a cornerstone industry in the US and it's unbelievable that they are getting away with destroying it, this is a measure of how stupid we have become.
If we had a court system maybe Cat could sue the government for loss of revenue and rackateering but we don't so everybody hug an environmentalist and take a deep breath off of the "clean" fracked NG flares...... because carbon.
Beause Al Gore, that smug fuck.
What he and his wife couldn't do for rock & roll lyrics he's done to industry in the US
I love the smell of reality in the morning. :D
Caterpillar: "Well, I was just walking along, minding my own business, and business was a bit soft, and then some blog did this eyeopener piece ... and ... POW! ... the floor disappeared ... I'd thought we could walk on clouds forever, and would be fine."
Bellweather ..... is that like a "weather bell" .... or a "weather rock" ?
Damn..can the marketplace take another 10,000 bartenders and waitresses?...I am a bartender and now we outnumber the customers.. I mean what the hell is going to happen to the employment numbers? is it possible to lay off a bartender?..not with customers like this:
One bourbon, one scotch and one beer
One bourbon, one scotch and one beer
Hey, Mister Bartender, come here
I want another drink and I want it now
My baby, she gone, she been gone two night
I ain't seen my baby since night before last
One bourbon, one scotch and one beer
I drink alone, just me and my Ole Grand Dad
+100 for George and Destroyers reference
Seems to be no drop in demand for Diversity Coordinators and Equal Opportunity Manangers.
Fools
Hire Carly, move the entire compay offshore , just the difference in energy taxes will push CAT to profitability, then outsource all those CHINESE JOBS to Africa.
Caterpillar has become the world-wide symbol for the destruction of Palestinian homes by the government of Israel. It should therefore be no surprise that the rest of the world has entered an informal Boycott.
Cat give the Zionists a big hand in the ethnic cleansing of Palestinians in Gaza. Now they are being demolished. Karma is a bitch.
Cat D-9 in Israel
https://encrypted-tbn1.gstatic.com/images?q=tbn:ANd9GcRj6JxKtsP74i4wP5B4...
Dimon, Blankfein, Nuland, CAT - Bring it on.
aka: extermination/Genocide
Where is the guy from last week saying "you can't look at Cat in isolation" you have to look at the whole sector.
I suggest he take a look at Deere and JCB
-A. Huxley
No problem; this will trigger renewed demand in the bunker-dwelling industry.
I did some work for CAT back in the 90's with China.
The first thing I told management is that their designs and manufacturing were all going to be copied and reversed engineered by China SOE/PLA interests and that they were effectively creating their own global competition and that the very managers and engineers they were so happy to train, inform and bring to America would in fact be managers and directors for future China companies selling the same equipment and service, but at a 40% discount.
Well this is what "engagement" bring you folks.
Great equipment. Great People.
A lot of idle equipment just sitting around America unused and not being shipped to Asia and Africa.
But then you will see these guys go the way of John Deere and you won't even be owning your equipment anymore. It will be like a Microsoft Office license - you're really just renting equipment.
Trust me. This purge is the result of some MBA telling execs it will be all OK because they can outsource all their steel fab from China rather than actually build something themselves.
CAT D6 not much different than an HP toner cartridge.
RIP Curtis Mathes and Craftsman.
aka the perils of short-term planning.
BankOn; the Japanese engineers did the same thing in the 1970s. They came to Peoria and got the grand tour of the facilities. They were keen on golf - Peoria has a nice set of public courses for a city of its size - and would go play 54 holes at a stretch at literally 1/10th the green fees in Tokyo.
Not only for heavy equipment but also defense. Billions in R&D in US, sold to Chinese for pennies on the dollar by traitors.
The only thing we can hope for is that the Chinese waste a lot of money copying and building useless bpieces of junk like the F-22 raptor, which according to pilots can not competre in areial combat with the venerable F-16, which as I recall was designed and built as a sort of side project outside the purview of the Defense Department at realtively lower cost. Shows you what can be done when the government doesn't stick it's big fat fucking nose into things.
I can only guess at the financial reasons behind shutting down the A-10 Warthog production.
Several years ago I was at Lincoln Electric for some training. I was talking to guy in their overseas dept . I ask him where their next big market was going to be, expecting to hear the wonders of China. He said no effing way, that as soon as they set up plants they knew everything would be copied and that if you didn't give them access and joint ownership they wouldn't let you in. I ask Russia? Nope too corrrupt, India he said.
Christ, if Russia is more corrupt than India it must be SOOOOO bad.
LOL!!!! He said Russia was too corrupt, and he's singing the praises of India. LOL!!!!
Another company run into the ground by spreadsheet jockeys and AA appointees.
We are witnessing the results of circa 3 decades of US economic policy-
Tax cuts of the wealthy (Reagan)
Job-outsourcing (NAFTA), financial deregulation (repeal of Glass-Steagall, Commodity Futures act of 2000) (Clinton, Sen John McCain of Keating 5 fame, also a big supporter)
More tax cuts for the wealthy, followed by taxpayer funded $ multi-trillion wars in the ME (US/NATO war theater extends from Levant, to Caspian Basin, Persian Gulf, China Sea, Indian Ocean, Horn of Africa (war on Yemen), the Maghreb, to Eastern Europe and Russian border) and taxpayer funded $ multi trillion bank bailouts (aka QE; Bush II, continued under Obama)
Current state of US economy-
QE has inflated assets- stocks, real estate in SF, NYC, Boston. No one knows what the “true” value of these assets should be, thus we have large fluctuations in stock prices (aka “volatility”)
Unemployment is high and job growth anemic- >90% of “new” jobs are temp positions- low pay, no benefits or job security
Deficits continue climbing.
Commodity prices continue falling, a result of slack demand (high unemployment, working people do not have sufficient purchasing power). Bottom line- the world economy is stagnant/declining.
Buy gold and short the stock market.
That's all true and you also have to wonder what effect supressing gold and silver prices have on heavy equipment sales. If things were as they should be there would probably be a precious metals mining boom going on.... if the government would allow it that is.
I wouldn't say it's all true -- we aren't really seeing huge fluctuation in stock prices, for example. Stocks are mostly range bound. Volatility should be much higher than it is, and there's still a ton of complacency. His post is mostly true in a general sense, though.
Call it the Worldwide Caterpillar Boycott. Call it the delayed Rachel Corrie effect. Call it what you will.
Why on Earth(moving) would demand ever improve again?
"We don't make these decisions lightly, but I'm confident these additional steps will better position Caterpillar to deliver solid results when demand improves."
Well..... if world war III kicks off we may have to dig a lot of mass graves maybe? When all of the shoddy built boom housing begins to deteriorate they will need equipment to finish tearing it down? Shit, you've got me.
Years ago I tried to help Caterpillar build a presence in the Philippines. There was a great demand for their equipment, which was preferred over the Japanese equivalents at that time. They were not interested in doing business there. It does not surprise me that they have lost ground all around the World, as they never have really cared if they lost market share or not.
OT(kinda): I know of a guy who was a garbage truck driver. Not much money but it was a job. He did the math and decided that it was better to be unemployed, draw free insurance (medicaid), EBTs, unemployment, housing, etc. So he let his performance slack so they laid him off. Plus, his 'wife' isn't an actual licensed wife, so all of the benefits are x2. He said he can work around for cash for a few hours a day and make more money than a 8+hr/day full time job.
That is what is wrong with the employment situation in Amerika. Withdraw the 'freebies' and employment would SURGE.
Also need to kill the plague that rob's all .gov
Also, the huge boom back in the 2011 area..................many of those units are still in use. Not every household needs a CAT. And when you get one, it lasts quite sometime.
So in other words, flood the market, make a mint, then just maintain till it happens again. Typical boom/bust. They know full well the charts not going up forever, just PR shit, possibly keep from getting shot by ex-employees, etc.
I don't think there is much of a problem for CAT - take a shovel and see how long it takes you to dig a hole 6'x6'x6'....
Hard to compete with slave labour from china with no benefits, unless of course you have slave labour in amurica with no benefits.
Problem solved.