Caterpillar Inc.

Caterpillar Inc.

File:Caterpillar Inc. logo.svg Caterpillar's "CAT" logo
Company type	Public
Industry	Construction machinery, mining equipment, diesel and natural gas engines, financial services
Founded	April 15, 1925 (1925-04-15) (merger of Holt Manufacturing Company and C. L. Best Tractor Company)
Founder	Benjamin Holt, C. L. Best (predecessors)
Headquarters	Irving, Texas , United States
Area served	Worldwide
Key people	(not specified)
Products	Heavy machinery (bulldozers, excavators, wheel loaders, haul trucks), diesel and gasoline engines, financial products and services
Number of employees	(not specified)
Website	www.caterpillar.com

Caterpillar Inc., commonly referred to as Cat, is an American corporation specializing in the manufacture of equipment for construction, mining, and engineering sectors. It holds the distinction of being the largest producer of construction machinery worldwide. The enterprise is structured around three primary divisions: Machinery, Engines, and Financial Products.

In 2018, Caterpillar was positioned 73rd on the Fortune 500 rankings and secured the 265th spot on the Global Fortune 500 list. The company's shares are included in the Dow Jones Industrial Average index.

The origins of Caterpillar trace back to 1925 when the Holt Manufacturing Company merged with the C. L. Best Tractor Company, creating the California-based Caterpillar Tractor Company. In 1986, it was restructured as a Delaware corporation under its current name. The firm moved its headquarters from Peoria, Illinois, to Deerfield, Illinois, in 2017, and later relocated to Irving, Texas in 2022.

Caterpillar's product range encompasses heavy-duty machinery such as the D11 Bulldozer, 345C L Excavator, 930G Wheel Loader, and 797F Haul Truck. It also manufactures diesel and gasoline engines including models like the C13 and C32. Beyond equipment manufacturing, the company provides financial services covering financing options, insurance policies, maintenance solutions, and operator training programs.

Subsidiaries under Caterpillar include Caterpillar Financial Services, Caterpillar Insurance Holdings, Progress Rail, Perkins Engines, Solar Turbines, among others. The brand is licensed for apparel and work footwear under Cat / Caterpillar and previously extended to rugged mobile devices marketed under the Cat phone brand until 2024.

A signature aspect of Caterpillar’s branding is its recognizable "Caterpillar Yellow" color scheme paired with the "CAT" logo, which together form a core part of its corporate identity.

Origins

The Holt Manufacturing Company was established in 1890, initially producing steam-powered tractors intended for agricultural use. These early machines were quite heavy and frequently became stuck in the soft soil around Stockton, California. To counter this problem, founder Benjamin Holt increased the size of the wheels, but this solution led to greater mechanical complexity and higher costs.

In pursuit of a more effective approach, Holt developed an innovative continuous track system by substituting wheels with wooden tracks attached to chains. This breakthrough design was successfully demonstrated on November 24, 1904, at Roberts Island in the Sacramento–San Joaquin River Delta, representing a significant advancement in the company's product development.

Concurrently, the English firm Richard Hornsby & Sons created a steel-tracked vehicle patented in 1904 that utilized differential braking for steering, eliminating the need for a conventional front steering wheel. Five years later, Hornsby sold their patent rights to Holt, thereby broadening Holt’s technological capabilities.

The term "Caterpillar" originated from company photographer Charles Clements, who observed that the movement of the tracks resembled that of a caterpillar. Holt adopted this name as a key element of the brand identity.

In 1909, Holt introduced its first steam-powered crawler tractors priced at $5,500 (approximately $185,000 in 2024 dollars), equipped with continuous tracks made from redwood slats. On December 7, 1907, Holt secured the first patent for a functional continuous track system, solidifying its leadership in heavy machinery innovation.

Headquarters locations

On February 2, 1910, a new manufacturing facility was inaugurated in East Peoria, Illinois, under the management of Benjamin Holt’s nephew, Pliny Holt. Pliny collaborated with farm equipment dealer Murray Baker, who identified an unused factory originally constructed for farm implements and steam traction engines. Baker—who would later become Caterpillar Tractor Company’s first executive vice president—notified Stockton headquarters about the availability of the bankrupt Colean Manufacturing Co.'s plant in East Peoria. Pliny Holt acquired this factory on October 25, 1909, commencing operations with a workforce of 12. The business was incorporated as the Holt Caterpillar Company, and "Caterpillar" was trademarked on August 2, 1910.

Although significant investment was required to retool the East Peoria plant, it quickly proved profitable; within two years employment rose to 625 workers and tractors were exported to markets including Argentina, Canada, and Mexico. Manufacturing continued simultaneously at both Stockton and East Peoria sites.

On January 31, 2017, Caterpillar announced relocating its corporate headquarters from Peoria to Deerfield, Illinois, occupying the former site of a Fiatallis wheel loader plant at 500 Lake Cook Road.

Subsequently, on June 14, 2022, the company disclosed plans to transfer its global headquarters from Deerfield to Irving, Texas, citing strategic business considerations.

Use in World War I

The earliest tanks used during World War I were produced by William Foster & Co. in Lincolnshire, England, debuting in 1916. This firm had collaborated with Hornsby on initial vehicle development and supplied paraffin engines.

Holt’s track-type tractors contributed significantly to WWI by delivering approximately 1,200 units to England, France, and Russia prior to American involvement. These tractors were adapted for towing artillery and transporting supplies at battlefronts. The British War Office evaluated and adopted Holt tractors as gun tractors primarily tasked with hauling medium artillery pieces such as the 6-inch howitzer, 60-pounder gun, and 9.2-inch howitzer.

The design of Holt’s tractors influenced British tank development profoundly and altered ground combat strategies. Major Ernest Swinton was an early advocate recognizing the potential of tracked vehicles. Although Britain ultimately chose an English manufacturer for its initial tanks, Holt’s innovations remained integral to military vehicle design during the conflict.

Challenges after the war

During World War I, Holt's production was largely driven by military contracts; however, the cessation of wartime demand left the company in a difficult position. The heavy-duty military tractors were not well-suited for agricultural use, while an influx of surplus artillery tractors saturated the market, causing prices to fall and resulting in excess stock for Holt. To maintain operations, the company incurred substantial debt.

Clarence Leo Best’s C. L. Best Gas Tractor Company, Holt’s primary rival, benefited from government contracts during the conflict by supplying smaller agricultural tractors, which gave it a competitive edge by the war’s conclusion. Best also took on significant loans to increase production of its Model 60 "Tracklayer."

Both firms encountered obstacles adapting to a peacetime economy amid the 1920–21 recession, which constrained sales growth. On December 5, 1920, Benjamin Holt passed away at age 71 following a short illness.

Formation of Caterpillar Tractor Company (1925)

In response to mounting financial pressure from creditors, Thomas A. Baxter succeeded Benjamin Holt as CEO and redirected the company’s focus away from large tractors toward smaller agricultural models. The Federal Aid Highway Act of 1921 prompted Baxter to steer the company toward manufacturing road-construction machinery, positioning it as a competitor to Fordson.

Between 1907 and 1918, Best and Holt expended approximately US$1.5 million on legal battles concerning contracts and patents. Harry H. Fair of Pierce, Fair & Company—Best’s debt financier—recommended merging the two companies to alleviate Holt’s financial difficulties. Consequently, in 1925, C. L. Best merged with Holt to establish Caterpillar Tractor Co., initially based in San Leandro before relocating its headquarters to Peoria in 1930.

Baxter was replaced as CEO in 1925 by Clarence Leo Best, who led until 1951. The company narrowed its product lineup to five track-type tractors: Holt’s 2 Ton, 5 Ton, and 10 Ton models alongside Best’s Caterpillar 30 and Caterpillar 60. By 1928, production of smaller models ceased. Despite the Great Depression, first-year sales totaled US$13 million and expanded to US$52.8 million by 1929.

Caterpillar transitioned from gasoline to diesel engines, improving operational efficiency. During World War II, Caterpillar machinery played a crucial role supporting U.S. Navy Seabees constructing airfields across the Pacific Theater. The firm ranked 44th among U.S. military contractors by contract value during this period. Postwar construction booms spurred rapid growth and global expansion starting in 1950.

In 2018, Caterpillar undertook organizational restructuring that included closing its Panama demonstration center and an engine plant in Illinois as part of ongoing strategic realignments.

Growth in emerging markets

Caterpillar inaugurated its first Russian manufacturing plant in Tosno, near St. Petersburg, Russia, completed in 1999 and operational by 2000. This facility featured the first new electrical substation constructed in Leningrad Oblast since 1991, built under severe winter conditions. Managed by Finland's Lemminkäinen Group, production at this site ended in May 2022. In November 2023, Caterpillar agreed to divest its Russian holdings to PSK - New Solutions, a firm affiliated with Sberbank, with industry analysts skeptical about any resumption of manufacturing.

The $125 million Caterpillar Suzhou plant in China began producing medium-wheel loaders and motor graders targeting Asian markets in 2009. In Brazil, where Caterpillar has operated since 1960, a new factory was announced in 2010 to increase output of backhoes and small wheel loaders. In India, Caterpillar runs three manufacturing facilities located in Tamil Nadu and Maharashtra that produce machinery, engines, and generator sets.

Acquisitions

Caterpillar's expansion approach significantly depends on strategic acquisitions to broaden its product offerings and increase market presence. Notable acquisitions encompass:

  ... [Further acquisitions continue accordingly] ...   |-      

Acquired Company or Asset	Location	Acquisition Year	Previous Owner	Product Lines	Additional Details
Trackson	Milwaukee, Wisconsin, USA	1951		Traxcavators (tracked loaders), pipelayers	The "Traxcavator" brand was integrated into Caterpillar's lineup
Towmotor Corporation	Mentor, Ohio, USA	1965		Forklifts	Transitioned into Mitsubishi Caterpillar Forklifts joint venture in 1992 (80% owned by Mitsubishi Heavy Industries); marketed under Cat Lift Trucks
Solar Turbines Division	San Diego, California, USA	1981	International Harvester Company	Industrial gas turbines	Now operates as Solar Turbines Inc., a wholly-owned Caterpillar subsidiary
Balderson, Inc.	Wamego, Kansas, USA	1990		Construction and mining equipment tools (buckets, blades)	Renamed Caterpillar Work Tools in 1998; fully owned subsidiary
Barber-Greene Co.	Minneapolis, Minnesota, USA	1991		Paving machinery	Rebranded as Caterpillar Paving Products
Krupp MaK Maschinenbau GmbH	Kiel, Germany	1997	Fried. Krupp GmbH	Marine diesel engines	Became MaK Motoren GmbH; a wholly-owned subsidiary retaining the MaK brand
Perkins Engines	Peterborough, UK	1998	LucasVarity	Small diesel engines	Manufactures engines under both Cat and Perkins brands
Kato Engineering	Mankato, Minnesota, USA	1998	Rockwell Automation	Large electrical generators
F.G. Wilson	Larne, Northern Ireland	1999	Emerson Electric Company	Generators branded as Cat and Olympian	Acquired through asset exchange with Emerson acquiring Kato Engineering
Earthmoving Equipment Division (Hindustan Motors)	Chennai, India	2000		Construction machinery	Renamed Caterpillar India; services provided by Birla Group's GMMCO Ltd.
Caterpillar Elphinstone	Burnie, Australia	2000		Equipment for underground mining	Full ownership acquired; renamed Caterpillar Underground Mining
Sabre Engines Ltd.	Wimborne, UK	2000		Marine diesel engines	Renamed Caterpillar Marine Power UK; produces Cat- and Perkins-Sabre engines
Bitelli SpA	Minerbio, Italy	2000		Asphalt pavers and cold planers	Incorporated into Caterpillar Paving Products
Wealdstone Engineering Ltd.	Rushden, UK	2004		Gasoline and diesel engine remanufacturing	Integrated into Caterpillar Remanufacturing Services
Williams Technologies Inc.	Summerville, South Carolina, USA	2004	Delco Remy International Inc.	Transmission and engine remanufacturing	Part of Caterpillar Remanufacturing Services
Turbomach SA	Riazzino, Switzerland	2004	Babcock Borsig AG	Packaging of industrial gas turbines
Progress Rail	Albertville, Alabama, USA	2006	One Equity Partners	Products for railroad and transit systems; owner of Electro-Motive Diesel
Hindustan PowerPlus Ltd.	Mathagondapalli, India	2006	Hindustan Motors	Engine components and heavy-duty diesel engines	Acquired full ownership from joint venture; merged into Caterpillar India in 2008
Eurenov S.A.S.	Chaumont, France	2007		Remanufacturing automotive components	Part of Caterpillar Remanufacturing Services
Forestry Division of Blount International	Portland, Oregon, USA	2007		Equipment for timber harvesting and processing
Shandong Engineering Machinery (SEM)	China	2008		Wheel loaders
Lovat Inc.	Toronto, Canada	2008		Tunnel boring machines	Entered tunneling sector; exited by mid-2014 following strategic shift
Shin Caterpillar Mitsubishi Ltd.	Japan	2008	Mitsubishi Heavy Industries	Construction equipment	Majority stake acquired; renamed Caterpillar Japan Ltd.
MGE Equipamentos & Serviços Ferroviários	São Paulo, Brazil	2008		Railroad equipment remanufacturing
Gremada Industries Inc.	West Fargo, North Dakota	2008		Remanufacturing transmissions and torque converters
Twin City Signal Inc.	Hudson, Wisconsin	2008		Signaling and traffic control systems
JCS Co., Ltd.	South Korea	2009		Seal technology solutions
GE Inspection Products	Erie, Pennsylvania	2010		Rail inspection products (Progress Rail division)

Through these acquisitions, Caterpillar has significantly enhanced its offerings in construction machinery, power generation systems, rail products, mining technologies, and emission control solutions—thereby reinforcing its competitive position and global footprint. The company’s leadership consistently utilizes acquisitions as a core component of its growth strategy within the heavy equipment sector.

Divestitures

Caterpillar deliberately sells off non-essential assets to concentrate on its core areas of expertise.

Key Divestitures

Divested Asset	Location	Year	Buyer	Product Category	Remarks
Turbomach Division of Solar Turbines Incorporated	San Diego, California, USA	1985	Sundstrand Corporation	Auxiliary power units	Caterpillar's only aerospace-related asset, transferred to a longstanding collaborator.
Kato Engineering	Mankato, Minnesota, USA	1999	Emerson Electric Company	Large electrical generators	Part of an asset exchange; Caterpillar gained F.G. Wilson generators through this transaction.
Agricultural equipment assets	DeKalb, Illinois, USA	2002	AGCO Corporation	Challenger track tractors	Marked Caterpillar's exit from agricultural equipment production.
Preferred Group of Mutual Funds	N/A	2006	T. Rowe Price Group Inc.	Mutual funds	Caterpillar Investment Management Ltd. divested its investment management operations.
Pioneer Machinery	West Columbia, South Carolina, USA	2007	Consortium of six Caterpillar dealers	Forestry equipment distribution
ASV, Inc.	Grand Rapids, Minnesota, USA	2008	Terex Minnesota, Inc.	Rubber track machines	Caterpillar owned a 23.5% stake prior to supporting Terex’s acquisition.
Caterpillar Logistics Services	Morton, Illinois, USA	2012	Platinum Equity, LLC	Logistics and warehousing solutions	Caterpillar maintained a 35% ownership; business rebranded as Neovia Logistics Services LLC.

Historical Financial Data (in billions USD)

Year	2001	2002	2003	2004	2005	2006	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	2017	2018	2019	2020	2021	2022	2023
Revenue	20.51	20.19	22.81	30.31	36.34	41.52	44.96	51.32	32.37	42.59	60.14	65.88	55.66	55.18	47.01	38.54	45.46	54.72	53.80	41.75	50.97	59.43	67.06
Net Income	0.805	0.798	1.099	2.035	2.854	3.537	3.541	3.557	0.895	2.700	4.928	5.397	6.556	2.452	2.512	−0.067	0.743	6.147	6.093	2.998	6.489	6.705	10.34
Total Assets	30.49	32.71	36.71	43.10	47.07	51.45	56.13	67.78	60.04	64.02	81.22	88.83	84.76	84.50	78.34	74.70	76.96	78.51	78.45	78.32	82.79	81.94	87.48
Employees (thousands)	70.68	70.97	67.83	73.03	81.67	90.16	97.44	106.5	99.36	98.50	113.6	127.8	122..5	115..6	110..8	99..5	98..4	104..9	102..3	97..3	107..7	109..1	113..2

Business lines

Up until the fiscal year ending in 2010, Caterpillar’s operations were divided into three primary categories: machinery, engines, and financial services catering to both private and governmental sectors. By the year 2022, the company disclosed financial results segmented into four distinct divisions: construction industries, resource industries, energy & transportation, and financial products.

Machinery

Caterpillar distributes approximately 400 different products through its dealer network. Its range of machinery encompasses tracked tractors, hydraulic excavators, backhoe loaders, motor graders, off-highway trucks, wheel loaders, agricultural tractors, and locomotives. These machines are utilized across various sectors including construction, road infrastructure, mining, forestry, energy, transportation, and material handling.

As the leading global producer of wheel loaders, Caterpillar manufactures small wheel loaders (SWL) in Clayton, North Carolina. Medium (MWL) and large (LWL) wheel loaders are designed and assembled in Aurora, Illinois. Medium-sized loaders are also produced at facilities in Sagamihara, Japan; Piracicaba, Brazil; India; and China. Large wheel loaders are exclusively built on three assembly lines located in Aurora.

On-road trucks

In 2011, Caterpillar introduced the Cat CT660 Class 8 vocational truck to the market. However, by March 2016, the company discontinued its on-highway truck production. According to Ramin Younessi, vice president of the Industrial Power Systems Division, further investment to develop a comprehensive truck lineup was not justified due to limited market potential. This strategic decision enabled Caterpillar to withdraw from the on-highway truck sector before commencing production at its Victoria facility.

Engines and gas turbines

Caterpillar produces diesel and natural gas engines as well as gas turbines that power its own equipment and serve as prime movers in locomotives, semi trucks, marine vessels, and ships. These engines also support peak-load power plants and emergency generator applications.

The Caterpillar 3116 engine was succeeded in 1997 by the inline six-cylinder 7.2-litre Caterpillar 3126 engine, notable as Caterpillar’s first electronically controlled diesel engine for light trucks and buses. Subsequent models—the 3126B (1998) and 3126E (2002)—offered reduced emissions and noise levels along with enhancements such as an upgraded high-pressure oil pump and refined electronic controls. In 2003, the company launched the C-7 engine to comply with stricter United States emission standards, incorporating Advanced Combustion Emissions Reduction Technology (ACERT). The C7 was further updated in 2007 to meet ultra-low-sulfur diesel requirements by integrating common rail fuel injectors and improved ACERT electronics.

In 1998, Caterpillar broadened its product line by acquiring Perkins Engines, a Peterborough-based manufacturer specializing in small diesel and gasoline engines. Perkins engines carry dual branding—either Perkins or CAT—depending on their intended use.

In June 2008, Caterpillar announced its withdrawal from the U.S. on-highway diesel engine market ahead of the 2010 EPA emission regulations, citing prohibitive compliance costs relative to the segment’s minor contribution to overall engine sales.

In October 2010, Caterpillar strengthened its global engine manufacturing capabilities by purchasing German engine producer MWM GmbH from 3i for $810 million.

Caterpillar Defence Products

Caterpillar Defence Products, based in Shrewsbury, UK, delivers diesel engines, automatic transmissions, and components for a range of military vehicles. These include the UK's Titan armored bridge layer, Trojan combat engineering tank, Terrier combat engineering vehicles, and tank transporters. The subsidiary also supplies Romania's MLI-84 armored personnel carriers, Swiss Piranha III light armored vehicles under development for the US military, as well as military trucks utilized in both the US and UK. Additionally, it supports the propulsion needs of the CV90 infantry fighting vehicle series employed by several European armed forces.

This segment also provides propulsion engines and power generation equipment tailored for naval shipbuilding. Among these is the Series 3512B turbocharged V-12 diesel engine used in US nuclear submarines. Caterpillar engines power vessels including s, Spanish s, British s, Mexican patrol boats, and Malaysian MEKO A-100 ships. Despite ongoing cybersecurity concerns related to submarine control systems, the US Navy has acknowledged Caterpillar’s control systems as exemplars of secure design practices.

The deployment of modified Caterpillar D9 bulldozers by the Israel Defense Forces has sparked criticism from activists and some investors due to their involvement in demolition operations during conflicts. A notable case occurred in 2003 when activist Rachel Corrie's death led to lawsuits targeting both Caterpillar and the Israeli government; these claims were ultimately dismissed. In 2014, the Presbyterian Church (USA) divested its shares in Caterpillar over its association with demolitions in the West Bank. More recently, in August 2024, San Francisco State University declared its intention to divest from Caterpillar along with other companies supplying arms to the Israeli military following a student-led resolution.

Caterpillar Electronics

The Caterpillar Electronics division formed a joint venture named Caterpillar Trimble Control Technologies LLC (CTCT) with Trimble Inc, equally owned by both companies. CTCT focuses on developing positioning and control solutions for earthmoving and paving machinery used in construction and mining sectors. Their products incorporate GNSS, optical total stations, lasers, and sonic technologies to offer operators accurate horizontal and vertical guidance. Headquartered in Dayton, Ohio, CTCT commenced operations on April 1, 2002.

Agriculture products

The Challenger line of agricultural tractors originated from development initiatives beginning in the 1970s that merged crawler and wheeled tractor technologies into what became known as the Challenger Tractor and "Mobi-Trac" system. From 1997 onward, Challenger tractors were marketed in Europe under the Claas brand, while Claas-built Lexion combines were sold by Caterpillar in the United States. Claas and Caterpillar jointly created Claas Omaha, a venture producing combines under the CAT brand at a Nebraska facility. In 2002, Caterpillar divested its ownership interest to Claas but retained licensing rights for the CAT brand on Lexion combines. That same year marked Caterpillar’s exit from agriculture when it sold its Challenger tracked tractor business to AGCO, granting them licenses to use both Challenger and CAT names.

Financial Services and Brand Licensing

Through its subsidiaries Cat Financial and Caterpillar Insurance Services, Caterpillar extends financing and insurance solutions. Cat Financial offers both retail and wholesale financing worldwide for Caterpillar machinery and associated assets, assisting dealers with funding for inventory and rental fleets. Additionally, Caterpillar earns revenue by licensing its brand globally.

Since 1994, Wolverine World Wide has held exclusive rights to produce Cat-branded footwear. Beyond footwear, various licensees manufacture a broad array of consumer goods featuring the Cat logo, such as scale models, clothing, timepieces, luggage, tools, gloves, and mobile devices. This multifaceted licensing approach broadens the brand’s reach beyond its traditional industrial sectors.

Manufacturing

Caterpillar operates 110 manufacturing sites around the globe, including 51 facilities in the United States and 59 plants internationally located in Belgium, Brazil, Canada, China, Czech Republic, England, France, Germany, Hungary, India, Indonesia, Italy, Japan, Mexico, the Netherlands, Northern Ireland, Poland, Russia, Singapore, South Africa, and Sweden. The company’s historic manufacturing hub and global headquarters remain in Peoria, Illinois, home to essential research and development activities. Key plants in the Peoria region include the Mapleton Foundry producing diesel engine blocks, the East Peoria tractor assembly facility, the Mossville engine plant, and the Morton parts distribution center.

Remanufacturing

In Latin America, significant remanufacturing is conducted at the Oradel Industrial Center in Nuevo Laredo, Mexico, which has been operational since 1988.

Distribution

Caterpillar’s products reach nearly 200 countries through a worldwide network of 220 independently owned dealerships with exclusive territorial rights. These dealers handle sales, service, repair, equipment rental, and parts distribution. Finning International, headquartered in Vancouver, Canada, stands as Caterpillar's largest distributor globally. In India, Gmmco Ltd serves as the leading dealer, while United Tractor & Equipment (UTE) is the exclusive authorized dealer in Sri Lanka.

The majority of dealerships employ the Dealer Business System (DBS) for daily operations. By early 2006 statistics showed that 66% of sales were generated through 63 U.S.-based dealers, with the remaining 34% coming from 157 international dealerships.

Management

Caterpillar’s governance structure merges the chairman and CEO roles under one executive while maintaining a fully independent board composed of non-employee directors. The CEO is supported by several group presidents and multiple vice presidents. The board functions through three main committees: audit; compensation and human resources; and governance and public policy.

A global code of business conduct governs employee behavior. Originally introduced in 1974 and revised in 2005, this code requires annual compliance assessments for management personnel.

Current Board of Directors

As of October 2023, members of the board include:

• D. James Umpleby III (Chairman and CEO)
• Daniel M. Dickinson
• Gerald Johnson
• David W. MacLennan
• Debra L. Reed-Klages
• Susan C. Schwab
• Rayford Wilkins, Jr.

Jim Umpleby took over as CEO on January 1, 2017, succeeding Douglas R. Oberhelman while Dave Calhoun served as non-executive chairman. In December 2018, Umpleby consolidated leadership by also becoming chairman, reversing the previous separation of these positions. After nearly four and a half decades at Caterpillar—including eight years as CEO—Umpleby will transition to Executive Chairman effective May 1. Joseph E. Creed, currently COO with 28 years at the company, will assume the CEO role and join the board on that date.

This leadership change underscores Caterpillar’s commitment to maintaining experienced executive leadership to ensure strategic continuity and foster sustained business growth.

Workforce and Labor Relations

By the end of 2009, Caterpillar's global workforce numbered 93,813 employees, with 50,562 stationed outside the United States. This figure marked a reduction of 17,900 workers compared to the third quarter of 2008, reflecting a long-term restructuring effort dating back to the 1990s that eliminated 20,000 union positions in Peoria, Illinois, while simultaneously expanding its international staff.

In 2020, Caterpillar revealed intentions to eliminate up to 700 positions at its Northern Ireland facilities.

Labor Practices

In the early 1980s, Caterpillar confronted near insolvency due to fierce competition from Japanese competitor Komatsu and the impact of the U.S. embargo on the Soviet Union, which halted $400 million in sales. This sharp decline in demand triggered layoffs and strikes primarily involving the United Auto Workers (UAW) at plants located in Illinois and Pennsylvania.

The company experienced extended UAW strikes during 1992 and again between 1994 and 1995. Although Caterpillar posted record profits during these periods, the strikes concluded with workers returning without a new contract. While wage increases were proposed by Caterpillar, union resistance persisted as the UAW sought wage parity with rivals like John Deere.

Throughout these labor disputes, Caterpillar utilized management personnel and non-union employees to sustain production levels and temporarily ceased research and development activities. To diminish union influence, the company outsourced manufacturing of parts and warehousing operations and adopted a "southern strategy," opening smaller "focus facilities" in right-to-work states such as North Carolina, South Carolina, Mississippi, Tennessee, Georgia, Texas, and Arkansas.

In 2012, Caterpillar implemented a lockout at its locomotive plant in London, Ontario, demanding wage reductions up to 50% to align labor costs with those in the United States. This action drew significant criticism and prompted retailers like Mark's Work Wearhouse to discontinue sales of Caterpillar-branded boots in protest.

On May 1, 2012, approximately 780 members of the International Association of Machinists and Aerospace Workers Local Lodge 851 initiated a strike; negotiations concluded in August with an agreement including a six-year wage freeze. Employees expressed dissatisfaction given Caterpillar’s record-breaking profits in 2011 alongside CEO Oberhelman’s salary increase of 60%.

Coerced Labor in Xinjiang

Reports surfaced in June 2020 indicating that Summit Resource International—a supplier of clothing for Caterpillar—was involved in a Chinese government-run labor transfer program linked to forced labor of Uyghurs detained in Xinjiang internment camps.

Environmental Stewardship

Since 1997, various Caterpillar divisions have consistently received Illinois Governor's Pollution Prevention Awards. In 2007, the company was recognized for initiatives that significantly reduced hazardous waste and water consumption across multiple sectors: the Hydraulics division replaced chroming processes with flame-sprayed coatings, cutting hazardous waste by 700,000 pounds and conserving 14 million gallons of water annually; the Cast Metals division partnered with the American Foundry Society to enhance scrap metal recycling efficiency while maintaining cost-effectiveness; and the Mossville Engine Center improved oil recycling procedures, reducing oil consumption by 208,000 gallons per year.

In 2004, Caterpillar supported the U.S. Environmental Protection Agency's National Clean Diesel Campaign by retrofitting older diesel engines to meet stricter emissions standards.

The following year, Caterpillar contributed $12 million to The Nature Conservancy aimed at protecting river ecosystems in Brazil, China, and the United States.

Caterpillar has been an active member of the Geneva-based World Business Council for Sustainable Development for many years and has consistently appeared on the Dow Jones Sustainability World Index every year since 2001.

Clean Air Act Noncompliance

In July 1999, Caterpillar, along with five other diesel engine producers, entered into a consent decree with the U.S. Department of Justice and the state of California following probes that uncovered breaches of the Clean Air Act. More than one million diesel engines were equipped with defeat devices that controlled emissions during laboratory testing but were deactivated during actual highway operation, resulting in nitrogen oxide (NOx) emissions up to three times above the legal threshold. In 1998 alone, these vehicles discharged an estimated 1.3 million tons of excess NOx—comparable to the pollution produced by 65 million automobiles. In August 2000, Caterpillar was designated "Clean Air Villain of the Month" by the Clean Air Trust. The settlement imposed $83 million in civil fines and established new compliance deadlines for emissions standards. Although Caterpillar lobbied successfully for extensions, it was the sole manufacturer failing to meet the revised October 2002 deadline, incurring $128 million in penalties assessed per non-compliant engine.

Carbon Emissions

For the fiscal year ending December 31, 2020, Caterpillar disclosed total greenhouse gas emissions measured as CO2 equivalent (both direct and indirect) at 1,521 kilotonnes, reflecting a 16.9% decline compared to the previous year. The company has set an objective to cut emissions by 30% relative to its 2018 baseline by 2030, underscoring its dedication to integrating sustainability within its corporate framework.

Annual Total CO2e Emissions for Caterpillar - Location-Based Scope 1 + Scope 2 (kilotonnes)

Dec 2017	Dec 2018	Dec 2019	Dec 2020
2,154	2,249	1,831	1,521

Tax Avoidance Strategies

In March 2017, federal agents conducted a raid at Caterpillar’s headquarters in Peoria amid investigations into the company’s aggressive tax planning practices. Since April 2014, a Senate subcommittee chaired by Senator Carl Levin scrutinized Caterpillar’s offshore tax arrangements, revealing the establishment of Swiss subsidiary Caterpillar SARL (CSARL) in Geneva designed to shift profits abroad. Former executive Daniel Schlicksup alleged that profits from replacement parts were routed to Switzerland despite no substantial operations there. The IRS held Caterpillar responsible for over one billion dollars in unpaid federal taxes covering the years 2007 through 2009.

PricewaterhouseCoopers (PWC), which managed Caterpillar’s financial strategy and global tax advisory services, faced criticism for potential conflicts of interest. Senate reports indicated these tax schemes aimed primarily at avoiding U.S. tax obligations. In January 2023, Caterpillar reached a settlement with the IRS concerning disputed tax positions from 2007 to 2016 without incurring penalties, concluding a protracted dispute.

Sales to Israel Defense Forces

Caterpillar’s provision of bulldozers to the Israeli military—specifically the IDF Caterpillar D9 model employed in occupied Palestinian territories—has attracted condemnation from human rights organizations and ethical investment watchdogs. Both Amnesty International and the United Nations High Commissioner for Human Rights cautioned Caterpillar about possible complicity in human rights abuses linked to bulldozer use during demolitions.

Human Rights Watch urged Caterpillar to halt sales on grounds of breaching its own business conduct policies. Activists supporting Palestinian causes and religious groups have pushed for shareholder inquiries into these dealings, while pro-Israel factions advocated reinforcing support through stock acquisitions.

In 2012, MSCI excluded Caterpillar from socially responsible investment indexes due to its military equipment sales. In 2017, leaked documents exposed that Caterpillar hired private investigators to monitor the family of Rachel Corrie, an American activist who died after being struck by a D9 bulldozer in 2003. Advocacy organizations continued in 2022 to highlight Caterpillar alongside other heavy machinery producers for their involvement in ongoing conflicts.

Trademark disputes

Caterpillar Inc. has initiated efforts to cancel trademarks registered in the United States that include the term "Cat," even when used in industries unrelated to its core machinery sector. Examples include "Cat & Cloud," a café located in Santa Cruz, California, and the internet phenomenon Keyboard Cat. This assertive approach to trademark protection has drawn criticism, particularly in cases where the potential for consumer confusion appears negligible.

Engine defects

In 2014, Caterpillar agreed to a $46 million settlement concerning allegations that one of its engines ignited a fire aboard a vessel owned by Bender Shipbuilding and Repair Company Inc. Two years later, in 2016, the company paid $60 million to settle claims that certain bus engines it produced were susceptible to failures and fire hazards.

Advocacy, philanthropy, and recognition

Caterpillar participates in the U.S. Global Leadership Coalition, a Washington D.C.–based alliance comprising over 400 corporations and non-governmental organizations that promote increased investment in U.S. diplomatic and international development initiatives. Projects fostering economic growth in developing nations, especially within rural farming communities, serve to expand markets for Caterpillar by enhancing stability and raising income levels.

In 2011, the National Building Museum honored Caterpillar with the Henry C. Turner Prize for Innovation in Construction Technology.

See also

• G-numbers related to U.S. Army Caterpillar tractors
• List of trucks

Further reading

• Orlemann, Eric C. Caterpillar Chronicle: The History of the World's Greatest Earthmovers. Minneapolis, MN: MBI Publishing Company, 2000.

External links

• Official Caterpillar Products Website
• Antique Caterpillar Machinery Owners Club
• Antique Caterpillar Machinery Enthusiasts
• Photographs of early Holt equipment
• Caterpillar Tractor Company Photograph Collection, Harvard Business School