Caterpillar Inc. announced it had acquired a manufacturing plant in Campo Largo, located in the state of Parana, Brazil. Caterpillar Inc. said the newly acquired facility will be used for the manufacture of backhoe loaders and small wheel loaders. Currently, the firm manufactures backhoe loaders and small wheel loaders at its Piracicaba facility.

The new plant is geared at producing part of the firm’s machine line up for its Building Construction Products (BCP) Division. It is expected to begin operations in 2011. Caterpillar Inc. has had a presence in Brazil for the last five decades and the investment adds upon this foundation, as well as the firm’s growth plans for the Latin America continent. The move thus subsequently aims at expanding Caterpillar’s operations in Brazil.

The new plant is expected to attain about 50,000 square meters after upgrades. Mary Bell, Caterpillar vice president of the Building Construction Products Division, said the new plant is a significant investment for the long term growth and success of its BCP division. Most importantly, she added, as the firm strives towards meeting the increased demand for its smaller, versatile machines that help its customers finish their work more productively and profitably.

Other than the new facility, Caterpillar as well announced plans to hike its capacity at its flagship plant in Piracicaba for the manufacture of core products. Total investment of about $180 million is expected in both facilities over the next two years. Rich Lavin, Caterpillar group president reiterated that the acquisition was a strategic decision targeted at expanding the firm’s Brazilian operations and as a long term plan for growing its base of customers.

In addition, it is also aimed at growing its business in key growth markets, subsequently expected to enable Caterpillar to meet the demand from its burgeoning customer base in Latin America. Caterpillar reiterated that the new plant was chosen after a careful analysis of Brazilian cities in the last six months. The selection of Campo Largo was due to its uniqueness and the possibility of burgeoning the firm’s capacity in the near future.

With 2009 sales and revenues of $32.396 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines.  The company is also a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services. The present production facility of Caterpillar in Brazil, located in Piracicaba, employs 5,000 people.

2 Sep 2010