A bigger Cat ready to serve mining industry

|  July 11, 2011 |

If discontinuing the 5000 Series shovels was a half-step back from the mining industry, Caterpillar is primed to take three or more steps forward.

“We’re ready to get started,” says Steve Wunning, Caterpillar group president, upon the July 8 announcement that the company’s $8.8-billion acquisition of Bucyrus International is complete. Caterpillar is adding about 120 models of surface and underground mining equipment, ranging from electric-powered trucks and draglines to scoops and jumbo drills. “The announcement marks the beginning of a new era in Caterpillar’s mining business,” says Wunning. “The joining of these two iconic companies is an incredible combination. It positions us for long-term success in an industry with significant growth potential, and we intend to fully leverage our unique strengths to help the mining customer make money.”

Chris Curfman, one of three vice presidents who will head up mining divisions reporting to Wunning, “couldn’t be more excited about the expansion of that opportunity,” he told Equipment World during a July 11 conference call. “It takes us into a part of the mining industry that we’ve never ventured into before. We almost triple the amount of coverage we have and the opportunity to participate with the Caterpillar brand in the mining industry. We see nothing but upside, and that’s pretty much the input we’ve had from our customers and frankly employees from both sides of the fence here.”

Speaking from the new Milwaukee-area Caterpillar Global Mining headquarters acquired in the Bucyrus acquisition, Curfman was echoed in his enthusiasm by fellow Caterpillar vice president and former Bucyrus chief operating officer Luis de Leon, who says that even in the one area of Cat-Bucyrus product overlap – trucks – there’s little concern for downside. “There’s a lot of demand. At the moment, we’re really more concerned about building enough product for the marketplace than worrying about consolidating facilities,” says de Leon. “To some degree, the markets that Bucyrus is successful in with our truck are not necessarily the same markets that Caterpillar is successful with the mechanical trucks. Demand in general is great, and I think there is a home and place for both products in the portfolio.”

Some finetuning of the truck lineup will take place, says Curfman, noting that the Bucyrus trucks will retain their historic Unit Rig brand throughout the transition to major Caterpillar components including engines. The trucks will eventually be branded Caterpillar. All other former Bucyrus products will immediately begin shifting to the Caterpillar brand. “As we examined this issue, it became clear it would be in the best long-term interests of our business to have a single brand for our mining customers, and that brand will be Caterpillar,” says Wunning. “This decision is important to quickly bring together one team with a single face to our customers.”

Of the 188 current Caterpillar distributors worldwide, 40-45 have “substantial” mining businesses and, says Curfman, are salivating at the opportunity to not only add the former Bucyrus products, but potentially former Bucyrus staff. “Our dealers are so short of people that it is the number-one issue in the world. Our dealers are desperately looking for people,” he says. “There are thousands of people in the field with Bucyrus, some of whom will stay with Caterpillar, some of whom will go to those dealers. Our dealers are absolutely just over the moon in terms of the ability to capture this talent.”

The rapid development of the world’s emerging markets is expected to continue to drive an increasing need for commodities, says Wunning, “and wherever there is mining, Caterpillar and our dealers will be there to serve our mining customers.”

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