Caterpillar does also realise benefits of the Japanese yen being down, as it does have operations in Japan. Its Japan operations offer net export products. ‘We aren’t perfectly balanced but we are balanced enough that it doesn’t drive big volatility in our bottom line’ DeWalt said. He also said that Caterpillar does little to hedge currency fluctuations.
Chief Executive Officer and Chairman, Doug Oberhelman, said they are working on a ‘strong dollar policy’.
‘That led us to basically go to a simple strategy: That is, produce where we sell,” Oberhelman said. “If we were solely an exporter, we’d be a lot more exposed,’ he said.
As well as Komatsu’s rising power with the falling yen, Caterpillar also has some other challenges. Declines in commodity prices have decreased the sale of mining equipment globally, which has taken its toll on Caterpillar’s revenue.Oberhelman is forecasting that 2016 will be the fourth year in a row that Caterpillar will realise lower revenues. This will be the first time in its history of 90 years of trading that this will have happened.
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