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): April 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 First Quarter Financial Release
dated April 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 further in 1997, the U.S. economy could
slow and negatively impact demand for the Company's products. If low interest
rates in Europe do not stimulate that economy or if government spending is
significantly reduced (or taxes raised), the demand for Company products in
that region could be negatively impacted.
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. Competitive pressures
did result in a decline in share of industry sales in the U.S. and Canada in
1996 and if those pressures resumed later in the year, sales for 1997 could
fall below current projections.
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: April 15, 1997
