Dealer Retail Sales Up, Caterpillar Reports

Caterpillar Inc. last week said dealer retail sales for the three months that ended in February rose 7 percent worldwide over the same period last year, helped by an 8 percent gain in North America.

February’s results were an improvement compared to the flat year-over-year machine sales reported for January 2003.

The Peoria, Ill-based company said total reciprocating engine and turbine engine sales to users and original equipment makers rose 5 percent in the month over the same period last year, led by a surprising 40 percent jump in sales of truck and bus engines.

“That was a little better than expected especially North American machines sales,” said Mark Koznarek, analyst at Midwest Research.

Koznarek said Caterpillar’s dealer sales figures contrast with the 7 percent decline in medium-duty machinery sales reported by the industry. Koznarek said the data suggests that Caterpillar is taking market share in this segment, or its dealer data reflects sales of higher-end machinery not included in the industry figures.

Caterpillar said dealer machine inventories rose 5 percent worldwide in February compared with January, and were up 2 percent from last February. North American inventories rose 9 percent from a month earlier and 6 percent from a year ago.

The company repeated it intends to cut $100 million from its inventory levels. Overall, inventories are at 2.6 months of sales from 2.8 months a year ago, with North American inventories flat compared with February 2002 at 2.6 months of sales. Koznarek said the rise in dealer sales and the increase in inventories will likely mean an additional boost to Caterpillar sales in the quarter.

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