Caterpillar Inc. (CAT) is set to close a factory in West Virginia as the company struggles with softening demand for its machines.
The closure is one of many over the past twelve months, including two plants in Ontario and one in South Carolina.
Company spokeswoman Barbara Cox says CAT is looking to “improve its cost structure” as the mining industry downturn continues to take its toll.
Overall 2013 capital spending among major mining companies is expected to drop 16% from a year earlier, according to Bloomberg analyst Karen Ubelhart.
Earlier this year the firm recorded a second successive quarterly loss, with a 43.5% drop in earnings.
2 Comments
Mike Failla
According to our “dear leader”, the economy is robust and working just fine. What planet its working fine on is not defined however.
frankinca
I imagine if the infrastructure boom in the US was not so good, that Cat would be in deeper Shinola. Probably the Cadillac of the earth moving and mining machines, but lower capex’s by miners mean either buy less Cat machines or more lower priced ones. Would the mining industry use the hi grade ore refining now, technique and buy more non-Cat machines to satisfy their immediate needs, knowing that later the machines will have to be replaced or repaired sooner because they aren’t Caterpillar ones. Is this situation a leading indicator of more woe for the mining/manufacturing sector of the economy. As these are production machines and not service ones that the investing economy seems to favor now. It is hard to believe we aren’t in an internet bubble now just like in the early 2000’s. The social and communication value of this structure has been ruined by NSA and others whose actions no longer allow people to believe they could rely on internet confidentiality to transport data and sales communications. The airlines are going to benefit as more couriers are used to move important confidential data.