2016 saw more reductions in sales and revenues for Caterpillar. That grows on the losses of 2015. Sales and revenue of $38.5 billion represents a more than 30-percent decline over the two year period.
Since the company announced its massive restructuring plans at the end of 2015, it’s cut 16,000 jobs around the globe. Caterpillar’s 2017 outlook also anticipates another $500 million in restructuring costs.
But Director of Investor Relations Amy Campbell says that will come mostly through, “additional consolidations and closures of facilities. What it does not represent and what we are not planning for are any more broad-based headcount reductions like we’ve seen in the last couple of years.”
Caterpillar’s 2017 outlook also anticipates flat sales and revenue. Campbell says,“if you look at the midpoint of the outlook we gave a range of $36-$39 billion. At the midpoint of that, they’re down just a little bit less than 3-percent. Down a little bit, broadly flat and I think that’s kind of how we see the whole year.”
As far as President Trump withdrawing the county from the Trans-Pacific Partnership and his plans to renegotiate NAFTA, Campbell says Caterpillar will continue to advocate for free trade agreements for a level playing field with their competitors.
Caterpillar is also planning annual bonuses, called incentive pay. But Campbell says the company will fund those at less than half of what it paid out last year.
Negotiations have also already started with the United Auto Workers, Caterpillar’s largest employee labor union. The current UAW contract expires at the end of February. Campbell says the 2017 budget blueprint holds no changes to the UAW contract.