Caterpillar Retail Orders Suffer Second Biggest Plunge Since Financial Crisis

Tyler Durden's picture

While the relentless decline in Caterpillar retail sales has been duly noted here every month for nearly 4 years, now posting 44 consecutive declines, the latest, July data was downright depressionary.

According to the company, in the latest month - just when China was supposed to be rebounding and the US recovery getting "stronger" - demand took another sharp leg lower, as follows:

  • North America machine sales down 20% after falling 12% in June
  • Asia/Pacific sales July down 7% after falling 7% in June
  • Latam sales July down 43% after falling 38%
  • EAME (Europe, Africa, Middle East) sales July down 13% after falling 4%

This means that Caterpillar's rolling 3-month retail machine sales dropped by 19% in July vs the more modest 12% fall in June and May. It also means that, as shown in the chart below, in the past month CAT retail sales just posed the second largest monthly drop since the financial crisis.

 

And the breakdown by segment.

Since we have said

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TradingIsLifeBrah's picture
TradingIsLifeBrah (not verified) Aug 18, 2016 9:51 AM

Why dig it up when you can 3D Print it?  Why 3D Print it when you can just use it in Virtual Reality?...

Looney's picture

Is it possible to buy a new CAT excavator with a subprime auto loan?
I would turn it into a Lowrider Pimpmobile in no time! ;-)
Looney

NEOCON1's picture

Best.  Post.  Today.

Theosebes Goodfellow's picture

I envision one of those open pit mine three-storied dump trucks bopping up and down to hiphop on Hydraulic suspension. Um-pata-boom-pata-boom-pata-boom. Sick. Crushin' it in da' hood.

Seriously, if CAT is to survive, they need to elect Trump. Hillary will not save the mining industry, and in not doing so will doom CAT. It's just that simple.

 

GUS100CORRINA's picture

I have a better idea ... "Augmented Reality". Isn't that what has been going on with financial markets?

 

When the truth finally emerges ... people are going to be in absolute denial and shock.

847328_3527's picture

How do they stay in business?

NoDebt's picture

Komatsu makes a better machine.

Winston Churchill's picture

The rate off collapse is increasing across the board.

The Japanese import/export figures last night were catastrophic.

No way they keep this pig made up until November.

October cliff dive is coming.Buckle up folks.

silverer's picture

Let's talk about all this bad news after the election. LMAO

Global Hunter's picture

Winston, I was kind of hoping for a August cliff dive. 

falconer's picture
falconer (not verified) Aug 18, 2016 9:55 AM

not too many farmers buying Cat Challengers with corn at $3

silverer's picture

"... the second largest monthly drop since the financial crisis."
SINCE the financial crisis? Aren't we in one NOW?

Infield_Fly's picture
Infield_Fly (not verified) Aug 18, 2016 10:07 AM

Yes, but CAT "adjusted" and "non-GAAP'd" so everything is fine.

tarsubil's picture

Closing in on 4 years of declining retail sales, a P/E of 44, and MarketWatch still says sentiment on CAT is 100% bullish.

http://www.marketwatch.com/investing/stock/cat

Gotta love it.

falconer's picture
falconer (not verified) tarsubil Aug 18, 2016 10:33 AM

CAT just moved into a spiffy new HQ in Peoria

youngman's picture

There are too many good copies or good enough copies out there...China has copied the Cats to a tee...they never will sell as many as they did...cheaper options out there now

wholy1's picture

Are ya [rural/provisioned] "hunkered down" yet to watch all the paper birds get blown out of the bushes by the shock-wave of the coming "Quickening" critical-mass event?

BeaverCream's picture

Caterpillar sells machines that have a lifetime of something like 10-20 years. So if you believe the absolutely incredible amount of sales that occurred between 2010 and 2013 it makes sense that people just don't need any more equipment.

I would assume that caterpillar was probably giving shit away after 2008 and once the shockwaves wore off that governments and companies realized it was time to buy new shit now.

Also, caterpillar simply can't compete with Komatsu. Same thing is happening with Cisco, they're old, they're expensive, they haven't changed, and now they're dying.

The idea that caterpillar can be used as a metric for the health of the construction industry in the 21st century is retarded.

markitect's picture

Channel Stuffing.  This is the resulting follow up years.

lasvegaspersona's picture

Not if you are in Peoria.....

jerry_theking_lawler's picture

You are right...but it can be used as a guage of the death of American industry...which it is a good metric for actually.

QQQBall's picture

12% in May and June is anything but MODEST.

Ghost of Porky's picture

They should do another round of photo ops with Obama.

It worked great last time.

treasureX's picture

Looks kind of similar to the gold chart. 

youngman's picture

It would be nice to compare sales with other manufacturers...

steelrules's picture

Massive amounts of equipment left the Alberta oil fields and headed south, the 60 cent loonie helped US buyers. Oil and gas are probably the single biggest buyer for CAT. The planned deindustrialization of North America continues. 

falconer's picture
falconer (not verified) steelrules Aug 18, 2016 11:15 AM

tar sand oil is expensive to extricate- so why do it if it is?

lasvegaspersona's picture

The US can't come back until the dollar loses it's reserve status.

At present it is overvalued and any exports are simply not affordable in the greater world.

When we get our new dollar we will compete easily...unless it takes 20 years and we completely lose what societal mojo we have left.

I doubt the chldren of millennials will be up for making (real) stuff.

damicol's picture

Maybe they should give customers a choice of colors and a selection of freebies like a pokeman game to stir the dead and dormant brain cells of any dumb fuck who buys one

Imagine, the CNBC and Bloomberg dildo squatters will wetting themselves silly  with excitement explaining how this is just greaaat for US economy now that you can get a CAT in your favorite shade of pink

Wile-E-Coyote's picture

Let's see some other comparisons with other manufacturers, these figures are meaningless without context.

falconer's picture
falconer (not verified) Wile-E-Coyote Aug 18, 2016 11:17 AM

with the Japs" garbage export #s it doesn't seem like they are shipping a lot of Komatsus

falconer's picture
falconer (not verified) Wile-E-Coyote Aug 18, 2016 11:18 AM

*

Phillyguy's picture

In the “new” economy retail sales (along with profits) no longer matter. Central banks are always available to provide unlimited ultra-cheap money for share buybacks, keeping stock prices inflated. Despite the fact that Caterpillar retail sales have declined for 44 consecutive months, CAT share price remains a bubbly $83. Another standout in the “new” economy is IBM, whose revenues have been declining since 2011 while IBM stock is a lofty $161. (Link: davidstockmanscontracorner.com/chart-of-the-day-financial-engineers-at-work-ibm-revenues-have-been-dropping-since-2011). The FED believes they have created the economic equivalent to a perpetual motion machine. Unfortunately, this is going to end very badly.

S Spade's picture

that just can't be...the stock market keeps making new highs

catepillar must be lying, the futures so bright i gotta wear shades...make that blinders

Aubiekong's picture

Why do people even eat caterpillars?  Is it an Asian thing?