CAT sales show mining slump only getting worse
With sales and operations at the ends of the earth, few companies are in a better position to take the pulse of the global economy and the resource sector in particular than Caterpillar.
The world's number one heavy equipment manufacturer has been hit hard by the decline in mining and construction – sales are down more than $20 billion from its peak just four years ago after a drop of over $8 billion last year.
And things are only getting worse in 2016. Much worse.
Sales have been falling for 39 months straight
After a flicker of hope in January when the rate of decline seemed to slow at least in some regions, Caterpillar's latest sales figures released today shows a renewed slump in the sector.
Sales to the mining industry make up 19% of total sales for the Peoria, Illinois-based giant (quarrying and aggregates account for another 10%) and worldwide sales to the sector dropped 42% in February on a rolling 3-month average basis.
Overall sales have been falling for 39 months straight.
Earlier this week Caterpillar warned of a 40% fall in revenues for the first quarter again led by lower sales into the resources industry.
With the release of its full year earning in January Chairman and CEO Doug Oberhelman said the company hasn't seen any signs of improvement and was reluctant to predict a bottom for the industry
Today's figures makes it clear why.