Caterpillar's big bet on the U.S. economy

[babylonsister]

Caterpillar's big bet on the U.S. economy
By John D. Stoll

VICTORIA, Texas | Mon Apr 9, 2012 8:23am EDT


(Reuters) - It hasn't been long since Caterpillar Inc (CAT.N) looked like the typical resident of the Rust Belt. Having misjudged how deep the U.S. economy would decline, the world's largest maker of construction machinery reduced its workforce by 33,000 people worldwide in 2009, closed plants and posted lower profits.

But the Peoria, Illinois-based company has mounted a quick recovery and is emerging as the poster child for America's manufacturing renaissance.

In 24 months, 15 Caterpillar facilities have been built or updated in the United States, tens of thousands of workers have been added to the payroll and $2 billion is committed for capital investments on its home soil this year.

"We haven't seen Caterpillar doing this much building in the United States since probably the 1960s," said Peter Holt, owner of the Holt Caterpillar dealership in San Antonio. Caterpillar is building a $200 million plant two hours southeast of his store, in Victoria, Texas, that is slated to start churning out badly needed excavators later this summer.

Underpinning Caterpillar's U.S. momentum is a flood of demand by heavy equipment users in America - ranging from construction companies to oil drillers to cement producers - who are looking to replace aging machines now that the economy is improving and credit is easier to obtain.

more...

http://www.reuters.com/article/2012/04/09/us-caterpillar-bet-idUSBRE8380AY20120409

[lacrew]

1. I imagine the weak dollar has alot to do with this

Cat is the Cadillac of excavation equipment...everybody wants one, but can't justify it, when an import costs so much less. As that price gap narrows (due to the weakening dollar), a Cat is a more justifiable purchase.