Caterpillar Inc.

Former headquarters in Peoria, Illinois
Trade name	CAT
Company type	Public
Traded as	NYSE: CAT DJIA component S&P 100 component S&P 500 component
Industry	Heavy equipment Engines Financial services
Predecessor	C. L. Best Tractor Company Holt Manufacturing Company
Founded	April 15, 1925; 99 years ago (1925-04-15) in Wisconsin, U.S.
Founders	C.L. Best Benjamin Holt[1]
Headquarters	Irving, Texas, U.S.[2]
Area served	Worldwide
Key people	Jim Umpleby (Chairman & CEO)
Products	Products List D11 Bulldozer 345C L Excavator 930G Wheel Loader 797F Haul Truck C13 Diesel Engine C32 Diesel/Gasoline Engine C280 Diesel/Gasoline Engine
Services	Services List Financing Insurance Maintenance Training
Revenue	US$67.06 billion (2023)
Operating income	US$12.97 billion (2023)
Net income	US$10.34 billion (2023)
Total assets	US$87.48 billion (2023)
Total equity	US$19.50 billion (2023)
Number of employees	113,200 (December 2023)
Subsidiaries	Subsidiary List Caterpillar Financial Services Caterpillar Insurance Holdings Caterpillar Logistics Services Caterpillar Marine Power Systems FG Wilson Perkins Engines Progress Rail Solar Turbines
Website	caterpillar.com
Footnotes / references [3][4][5]

Caterpillar Inc., also known as CAT, is an American construction, mining and other engineering equipment manufacturer.^[6] The company is the world's largest manufacturer of construction equipment.^[3][7][8] In 2018, Caterpillar was ranked number 73 on the Fortune 500 list^[9] and number 265 on the Global Fortune 500 list.^[10] Caterpillar stock is a component of the Dow Jones Industrial Average.^[11]

Caterpillar Inc. traces its origins to the 1925 merger of the Holt Manufacturing Company and the C. L. Best Tractor Company, creating a new entity, California-based Caterpillar Tractor Company.^[12] In 1986, the company reorganized itself as a Delaware corporation under the current name, Caterpillar Inc. It announced in January 2017 that over the course of that year, it would relocate its headquarters from Peoria, Illinois, to Deerfield, Illinois, scrapping plans from 2015 of building an $800 million new headquarters complex in downtown Peoria.^[13][14] Its headquarters are located in Irving, Texas, since 2022.^[15][16]

The company also licenses and markets a line of clothing and workwear boots under its Cat / Caterpillar name.^[17][18] Additionally, the company licenses the Cat phone brand of toughened mobile phones and rugged smartphones since 2012.^[19] Caterpillar machinery and other company-branded products are recognizable by their trademark "Caterpillar Yellow" livery and the "CAT" logo.^[20]

History

Origins

The company traces its roots to the steam tractor machines manufactured by the Holt Manufacturing Company in 1890.^[21] The steam tractors of the 1890s and early 1900s were extremely heavy, sometimes weighing 1,000 pounds (450 kg) per horsepower, and often sank into the earth of the San Joaquin Valley Delta farmland surrounding Stockton, California.^[22] Benjamin Holt attempted to fix the problem by increasing the size and width of the wheels up to 7.5 feet (2.3 m) tall and 6 feet (1.8 m) wide, producing a tractor 46 feet (14 m) wide, but this also made the tractors increasingly complex, expensive, and difficult to maintain.

Another solution considered was to lay a temporary plank road ahead of the steam tractor, but this was time-consuming, expensive, and interfered with earthmoving. Holt thought of wrapping the planks around the wheels.^[22] He replaced the wheels on a 40 horsepower (30 kW) Holt steamer, No. 77, with a set of wooden tracks bolted to chains. On Thanksgiving Day, November 24, 1904, he successfully tested the updated machine plowing the soggy delta land of Roberts Island.^[23]

Contemporaneously, Richard Hornsby & Sons in Grantham, Lincolnshire, England, developed a steel plate-tracked vehicle, which it patented in 1904.^[24] This tractor was the first to be steered using differential braking of the tracks, eliminating the forward tiller and steering wheel. Several tractors were made and sold to operate in the Yukon, one example of which was in operation until 1927, and remnants of it still exist. Hornsby found a limited market for their tractor, so they sold their patent to Holt five years after its development.^[25]

Company photographer Charles Clements, looking at the machine's upside-down image through his camera lens, commented that the track rising and falling over the carrier rollers looked like a caterpillar,^[26][27] and Holt seized on the metaphor. "Caterpillar it is. That's the name for it!"^[23] Some sources, though, attribute this name to British soldiers who had witnessed trials of the Hornsby tractor in July 1907. Two years later, Holt sold his first steam-powered tractor crawlers for US$5,500, about US$185,000 in 2024. Each side featured a track frame measured 30 inches (760 mm) high by 42 inches (1,100 mm) wide and were 9 feet (2.7 m) long. The tracks were 3 inches (76 mm) by 4 inches (100 mm) redwood slats.^[23]

Holt received the first patent for a practical continuous track for use with a tractor on December 7, 1907, for his improved "Traction Engine" ("improvement in vehicles, and especially of the traction engine class; and included endless traveling platform supports upon which the engine is carried").^[28]

Headquarters locations

On February 2, 1910,^[27] Holt opened up a plant in East Peoria, Illinois, led by his nephew Pliny Holt. There, Pliny met farm implement dealer Murray Baker, who knew of an empty factory that had been recently built to manufacture farm implements and steam traction engines. Baker, who later became the first executive vice president of what became Caterpillar Tractor Company, wrote to Holt headquarters in Stockton and described the plant of the bankrupt Colean Manufacturing Co. of East Peoria. On October 25, 1909, Pliny Holt purchased the factory,^[30] and immediately began operations with 12 employees.^[31] Holt incorporated it as the Holt Caterpillar Company, although he did not trademark the name Caterpillar until August 2, 1910.^[27]

The addition of a plant in the Midwest, despite the hefty capital needed to retool the plant, proved so profitable that only two years later, the company employed 625 people and was exporting tractors to Argentina, Canada, and Mexico.^[32] Tractors were built in both Stockton and East Peoria.^[33][34]

On January 31, 2017, the company announced plans to move their headquarters from Peoria to Deerfield, Illinois, by the end of 2017.^[35] The new location at 500 Lake Cook Road is the former site of a Fiatallis plant that manufactured wheel loaders for many years.

On June 14, 2022, the company announced plans to move its global headquarters from Deerfield, Illinois, to Irving, Texas, beginning later in the year, citing "the best strategic interest of the company."^[36]

Use in World War I

The first tanks used in WWI were manufactured by William Foster & Co., also in Lincolnshire, England, and were introduced to the battlefield in 1916. That company had collaborated with Hornsby in the development of the vehicles demonstrated to the British military in 1907, providing the paraffin (kerosene) engines.

Holt's track-type tractors played a support role in World War I. Even before the U.S. formally entered WWI, Holt had shipped 1,200 tractors to England, France, and Russia for agricultural purposes. These governments, however, sent the tractors directly to the battlefront, where the military put them to work hauling artillery and supplies.^[37] When World War I broke out, the British War Office ordered a Holt tractor and put it through trials at Aldershot. The War Office was suitably impressed and chose it as a gun tractor.^[38] Over the next four years, the Holt tractor became a major artillery tractor, mainly used to haul medium guns such as the 6-inch howitzer, the 60-pounder, and later the 9.2-inch howitzer.^[39]

Holt tractors were also the inspiration for the development of the British tank, which profoundly altered ground warfare tactics.^[23][40] Major Ernest Swinton, sent to France as an army war correspondent, very soon saw the potential of a track-laying tractor.^[41]: 116 Although the British later chose an English firm to build its first tanks, the Holt tractor became "one of the most important military vehicles of all time."^[39]

Postwar challenges

Holt tractors had become well known during World War I. Military contracts formed the major part of the company's production. When the war ended, Holt's planned expansion to meet the military's needs was abruptly terminated. The heavy-duty tractors needed by the military were unsuitable for farmers. The company's situation worsened when artillery tractors were returned from Europe, depressing prices for new equipment and Holt's unsold inventory of military tractors. The company struggled with the transition from wartime boom to peacetime bust. To keep the company afloat, they borrowed heavily.

C. L. Best Gas Tractor Company, formed by Clarence Leo Best in 1910, and Holt's primary competitor, had during the war received government support, enabling it to supply farmers with the smaller agricultural tractors they needed.^[42][43] As a result, Best had gained a considerable market advantage over Holt by war's end. Best also assumed considerable debt to allow it to continue expansion, especially the production of its new Best Model 60 "Tracklayer".

Both companies were adversely impacted by the transition from a wartime to a peacetime economy, which contributed to a nationwide depression, further inhibiting sales. On December 5, 1920, 71-year-old Benjamin Holt died after a month-long illness.^[43][44]

Caterpillar company formed (1925)

The banks and bankers who held the company's large debt forced the Holt board of directors to accept their candidate, Thomas A. Baxter, to succeed Benjamin Holt. Baxter initially cut the large tractors from the company's product line and introduced smaller models focused on the agricultural market. When the Federal Aid Highway Act of 1921 funded a US$1 billion federal highway building program, Baxter began refocusing the company towards building road-construction equipment.^[30]: 66 Both companies also faced fierce competition from the Fordson company.

Between 1907 and 1918, Best and Holt had spent about US$1.5 million in legal fees fighting each other in a number of contractual, trademark, and patent infringement lawsuits.^[45] Harry H. Fair of the bond brokerage house of Pierce, Fair & Company of San Francisco had helped to finance C. L. Best's debt and Holt shareholders approached him about their company's financial difficulty. Fair recommended that the two companies should merge. In April and May 1925, the financially stronger C. L. Best merged with the market leader Holt Caterpillar to form the Caterpillar Tractor Co.^[46]

The new company was headquartered in San Leandro until 1930, when under the terms of the merger, it was moved to Peoria.^[31] Baxter had been removed as CEO earlier in 1925, and Clarence Leo Best assumed the title of CEO, and remained in that role until October 1951.^[42]

The Caterpillar company consolidated its product lines, offering only five track-type tractors: the 2 Ton, 5 Ton, and 10 Ton from the Holt Manufacturing Company's old product line and the Caterpillar 30 and Caterpillar 60 from the C. L. Best Tractor Co.'s former product line. The 10 Ton and 5 Ton models were discontinued in 1926. In 1928, the 2 Ton was discontinued. Sales the first year were US$13 million. By 1929, sales climbed to US$52.8 million, and Caterpillar continued to grow throughout the Great Depression of the 1930s.

Caterpillar adopted the diesel engine to replace gasoline engines. During World War II, Caterpillar products found fame with the Seabees, construction battalions of the United States Navy, which built airfields and other facilities in the Pacific Theater of Operations. Caterpillar ranked 44th among United States corporations in the value of wartime military production contracts.^[47] During the postwar construction boom, the company grew at a rapid pace, and launched its first venture outside the U.S. in 1950, marking the beginning of Caterpillar's development into a multinational corporation.

In 2018, Caterpillar was in the process of restructuring, closing a demonstration center in Panama and an engine-manufacturing facility in Illinois.^[48]

Expansion in developing markets

Caterpillar built its first Russian facility in the town of Tosno, located near St. Petersburg, Russia. It was completed in 16 months, occupied in November 1999, and began fabricating machine components in 2000.^[49] It had the first electrical substation built in the Leningrad Oblast since the Communist government was dissolved on December 26, 1991. The facility was built under harsh winter conditions, where the temperature was below −25 °C. The facility construction was managed by the Lemminkäinen Group in Helsinki, Finland.^{[citation needed]}

In May 2022, production at the Tosno plant was stopped. In November 2023, an agreement was reached on the sale of Caterpillar assets to the Russian company PSK - New Solutions, founded by people from Sberbank. Experts believe that the resumption of Caterpillar production is unlikely and the plant will be repurposed.^[50]

The $125 million Caterpillar Suzhou, People's Republic of China facility, manufactures medium-wheel loaders and motor graders, primarily for the Asian market. The first machine was scheduled for production in March 2009. URS Ausino, in San Francisco, California, manages facility construction.^{[citation needed]}

Caterpillar has manufactured in Brazil since 1960.^[51] In 2010 the company announced plans to further expand production of backhoe and small wheel loaders with a new factory.^[52]

Caterpillar has been manufacturing machines, engines, and generator sets in India, as well. Caterpillar has three facilities in India, which are in Tamil Nadu (Thiruvallur and Hosur) and Maharastra (Aurangabad).

Acquisitions

In addition to increasing sales of its core products, much of Caterpillar's growth has been through acquisitions, including: