SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 15, 1997
CATERPILLAR INC.
(Exact name of registrant as specified in its charter)
Delaware
(State or other jurisdiction of incorporation)
1-768
(Commission File Number)
37-0602744
(IRS Employer I.D. No.)
100 NE Adams Street, Peoria, Illinois
(Address of principal executive offices)
61629
(Zip Code)
Registrant's telephone number, including area code: (309) 675-1000
Item 5. Other Events
SAFE HARBOR STATEMENT UNDER THE SECURITIES LITIGATION
REFORM ACT OF 1995
The information included in the "Economic and Industry Outlook" and
"Company Outlook" sections of the Company's Third Quarter Financial
Release dated October 15, 1997 is forward looking and involves
uncertainties that could significantly impact expected results. These
uncertainties include factors that affect all international businesses,
as well as matters specific to the Company and markets it serves.
For most companies operating in a global economy, monetary and fiscal
policies implemented in the U.S. and abroad could have a significant
impact on economic growth, and, accordingly, demand for a product. For
example, if the Federal Reserve raises interest rates, the U.S. economy
could slow and negatively impact demand for the Company's products. In
general, higher interest rates, reductions in government spending, higher
taxes, significant currency devaluations, and uncertainty over key
policies are some factors likely to lead to slower economic growth and
lower industry demand.
Political factors in the U.S. and abroad also have a major impact on
global companies. The Company is one of the largest U.S. exporters as a
percentage of sales. International trade and fiscal policies implemented
in the U.S. this year could impact the Company's ability to grow its
business abroad. U.S. foreign relations with certain countries and any
related restrictions imposed could also have a significant impact on
foreign sales. In addition, political instability in regions such as the
CIS and China make potential economic growth difficult to predict for
those countries.
Currency fluctuations are also a significant unknown for global
companies. If the U.S. dollar continues to strengthen against foreign
currencies, the Company's ability to realize price increases on sales
could be negatively impacted. Most of the Company's key competitors have
their principal manufacturing operations based in Japan or European
countries. The majority of Caterpillar's manufacturing assets are in the
United States. Consequently, with an overvalued dollar, the Company's
costs compared with these competitors are relatively higher. As a major
net exporter from the United States, an overvalued dollar, over time,
could have an unfavorable impact on Caterpillar's global competitive
position.
In addition to these factors, there are uncertainties related to the
Company's industry and specific operations. A major factor contributing
to the Company's success is its dealer distribution network. Dealer
practices, such as changes in inventory levels for both new and rental
equipment, are not within the Company's control (primarily because these
practices depend upon the dealer's assessment of anticipated sales) and
may have a significant positive or negative impact on our results.
The rate of infrastructure spending, housing starts, commercial
construction and mining also play a significant role in the Company's
results. Our products are an integral component of these activities
and as they increase or decrease in the U.S. or abroad, demand for our
products may be significantly impacted.
The Company operates in a highly competitive environment and our
outlook depends on a forecast of the Company's share of industry sales.
A reduction in that share could result from unanticipated pricing or
product strategies pursued by competitors, unanticipated product or
manufacturing difficulties, a failure to price the product competitively,
or an unexpected buildup in competitors' new machine or dealer owned
rental fleets.
Labor relations with the United Auto Workers remain an uncertainty.
The Company has demonstrated its ability to address a prolonged strike by
the UAW, as well as the return-to-work process following strike recess,
with no material impact on Company results. Because the UAW recently
rejected a new six-year contract proposal from the Company, however,
their future actions and potential impact are a contingency.
This discussion of uncertainties is by no means exhaustive but is
designed to highlight important factors that may impact our outlook.
Obvious factors such as general economic conditions throughout the world
do not warrant further discussion but are noted to further emphasize the
myriad of contingencies that may cause the Company's actual results to
differ from those currently anticipated.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CATERPILLAR INC.
By: /s/ R. Rennie Atterbury III
R. Rennie Atterbury III
Vice President
Date: October 15, 1997
