) has announced the opening of a proving ground and a large wheel
loader manufacturing facility in Tongzhou, Jiangsu Province in
China. The opening of the two new facilities in China is aimed at
supporting the company's growing operations in the region as well
as in other growth markets.
The Asia-Pacific Proving Ground (APPG) facility will provide
validation and product development services for Caterpillar
machinery produced in the region. On the other hand, the large
wheel loader manufacturing facility will cater to the needs and
requirements for quarry and mining applications in China and
The Cat 986 large wheel loader, which is to be produced at the
large wheel loader facility, was designed at Caterpillar's Wuxi
R&D center and validated by the APPG. It is the first
Caterpillar machine designed, validated and built in China
exclusively for China and global markets.
The Tongzhou site is favorably located at the mouth of the
Yangtze River to the East Sea and provides a logistics advantage
in terms of shipping. Machines can be shipped from the
Asia-Pacific region and from inland China to the proving ground
for testing, and then complete the shipping of the machines to
marketplaces in China and around the world. Furthermore, the site
is located near Caterpillar's existing manufacturing facilities
in China, as well as the majority of the company's existing
supply base in China.
Including these new facilities, Caterpillar currently has 23
existing manufacturing facilities, 4 new facilities under
construction, 4 R&D centers and 3 logistics and parts centers
and employs more than 15,000 people are under its employment
across the country.
Caterpillar continues to systematically strengthen its
business in China and remains committed to providing the lowest
owning and operating costs in the industry. However, signs of a
slowdown in China have triggered concerns lately as it will have
a negative effect on infrastructure and construction spending.
This will in turn negatively impact on Caterpillar's sales in the
near term. However, the long-term story remains intact as growing
economies promote the expansion of roads, new buildings and
reliable energy, which drives the demand for machinery.
Peoria, Illinois-based Caterpillar Inc. is the manufacturer of
construction and mining equipment, diesel and natural gas
engines, and industrial gas turbines. The company is one of the
few leading U.S. companies in an industry that competes globally
from a principally domestic manufacturing base. Caterpillar
operates two divisions - Machinery and Power Systems and
Financial Products. Caterpillar currently retains a Zacks Rank #4
Joy Global, Inc.
H&E Equipment Services Inc.
) and The
Manitowoc Company, Inc.
) retain a Zacks Rank #3 (Hold) in the same industry.
CATERPILLAR INC (CAT): Free Stock Analysis
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