Positioning to Long-Term Growth in China, Caterpillar put their eyes on Oriental

Caterpillar Inc. announced a new expansion project for the company's manufacturing facility in Xuzhou，China. Once completed in 2016, it will increase hydraulic excavator production by an additional 80 percent. Caterpillar also announced plans today to begin production of wheeled excavators at CXL beginning in early 2014，further expanding the range of products and services Caterpillar is offering to MErs in China and other growth markets.

For more than 85 years, they have made investments with a long-term view toward the market and building out an industry-leading range of products and support services for our growing base of customers in China.  

In the last seven years as they have grown their operations in China, Caterpillar's business from the United States to China have more than doubled.

CXL has become Caterpillar's flagship for manufacturing operations in China with leading product quality， safety and employee engagement. In recent years， the company and its independent dealers have made significant investments to expand the range of products and components produced in China， increase and improve customer support services， and expand and enhance dealer coverage in every province. CurrenTLy， Caterpillar has 17 facilities in China and another nine under construction.

The plan to manufacture wheeled excavators in China fits within Caterpillar's strategy for developing the widest and deepest product offering and support for the market. Currently， Caterpillar produces wheeled excavators in Grenoble，France. Production in Grenoble will continue， while the wheeled excavators produced in China will position Caterpillar to compete in China and other growth markets with this product.

"Caterpillar has been successfully producing excavators in China for nearly 20 years， and we are expanding our production capabilities as this market continues to grow，" said Gary Stampanato， Caterpillar vice president with responsibility for excavators. "Bringing production of wheeled excavators to China will give our customers more options and will position Caterpillar for continued success，" Stampanato added.

The additional hydraulic excavator capacity is subject to certain governmental agreements and approvals. The increases are expected to be in place in 2016， while production of the first wheeled excavator in Xuzhou is expected in the first quarter of 2014.

Forward-Looking Statements

Certain statements in this press release relate to future events and expectations and are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements do not guarantee future performance，and we do not undertake to update our forward-looking statements.

Caterpillar Boost remanufacturing industry

A few years ago, Caterpillar has been expanding continuously. Caterpillar announced an excavator production capacity expansion plan will expand to four times in Xuzhou Factory till to 2014. The first half of this year, Caterpillar still committed to advancing the base of Jiangsu, Shandong and other expansion plans and plan launched caterpillar excavator.

However, according to the reporter from Caterpillar (China) insiders, trapped in the Chinese market downturn, the project has not been pushed substantially. Unlike traditional capacity stopped expansion in China, Caterpillar remanufacturing field increased development efforts.

Reporters learned that Caterpillar has become one of the world's leading manufacturing companies, annually recycled about 2 million parts in the global. Because remanufacturing can save 70% of the parts, as well as 80% of water, electricity and other energy resources consumption can reduce more than 60% of the cost, and thus obtained the attention by Caterpillar. 68 Caterpillar factories in 17 countries currently engaged in remanufacturing.

Caterpillar in China has established two manufacturing companies - Caterpillar Remanufacturing Industry (Shanghai) Co., Ltd and Yuchai Remanufacturing Industry (Suzhou) Co., Ltd. The former produce pump, motor and engine parts. Offer Service for parts remanufacturing business of the region, it while also providing services to external customers and other Chinese Carter business units. Latter was run by Guangxi Yuchai and Caterpillar joint venture enterprise.

 In fact, several years ago, Richmond had said that the next decade global remanufacturing market will reach 100 billion U.S. dollars. China may become the largest market in the field. Richmond told the reporter, remanufacturing is one of the fastest-growing businesses in Caterpillar. Remanufactured products have reduced costs for customers, and benefit for the environment, increasing in more business opportunities. Caterpillar in China further promotes the remanufacturing business development.

It is reported Caterpillar remanufacturing business has been extended from the eastern region to the western region of China, in July this year, Caterpillar Remanufacturing begin to layout southwest.

Richmond said, remanufacturing policy plays a key role in China. Before in 2005, re-manufacturing is a restricted industry, and later it comes to realize the great significance for the achievement of sustainable economic development, which has now become encouraged industry. But it is still not perfect in terms of standards, distribution, tax policy, may take a long time to solve these problems.