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* AP…
Caterpillar said Monday that CEO and Chairman Doug Oberhelman will retire from the company next year and will be replaced as CEO by Jim Umpleby, an executive who has worked at the construction and mining equipment company for more than three decades. […]
Caterpillar has been dealing with falling sales because its customers have been hurt by falling oil prices and slower economic growth around the world, causing them to buy less equipment from Caterpillar.
* The Wall St. Journal has amounts to a career obituary today. The title is “How Caterpillar’s Big Bet Backfired” and it’s not all that kind…
Doug Oberhelman spent his first years as Caterpillar Inc.’s chief executive plowing billions of dollars into factories to build more of its familiar yellow machines and move the company deeper into mining equipment.
It was a bold bet, spectacularly mistimed. On Monday, Mr. Oberhelman announced plans to step down as chief executive by year’s end.
In 2010, when he took charge, the world was gripped by a global commodities boom, along with strong postrecession demand from developing markets and the energy industry. The world was ordering excavators and bulldozers and giant dump trucks at a rapid clip.
Mr. Oberhelman bet he could grab an outsize share if he could just make more equipment. He spent almost $10 billion world-wide on plants and equipment from 2010 through 2013.
posted by Rich Miller
Monday, Oct 17, 16 @ 11:50 am
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I wonder what his bonus is for such a failure?
I’ll bet his parachute is golden.
Comment by JS Mill Monday, Oct 17, 16 @ 11:56 am
Wait a tick — what are these global economic factors that the AP and WSJ speak of when it comes to manufacturing?
Oil prices? Demand for product? Global slowdown in economic growth? What do they have to do with anything?
Pass the Turnaround Agenda, flip a couple of switches and turn a couple of knobs in Springfield, and you’ve got a manufacturing boom, whether anyone wants to buy your product or not.
The governor has dozens of corporations lined up, ready to expand in Illinois regardless of global economic factors or demand for their products. He told us.
Comment by wordslinger Monday, Oct 17, 16 @ 11:59 am
Even the TA could not save him. I recall him cheering on the pension cuts…get he wouldn’t like losing his golden parachute. He also was a big China cheerleader. I think they bought enough to reverse engineer them.
Comment by David Monday, Oct 17, 16 @ 12:02 pm
How golden was the parachute for the thousands of Americans who lost their livelihoods because of his “bad bet?”
He has no honor, no shame. I hope his 30 pieces of silver were worth it.
Comment by Dee Lay Monday, Oct 17, 16 @ 12:13 pm
He simply waltzes off stage to join the ranks of those who are blessed never to have to truly pay for his mistakes and misjudgements since others (investors and employees) are covering that tab. It fits well with the current mantra of privatize the gains but “share” the losses so that they are spread to all.
Comment by former southerner Monday, Oct 17, 16 @ 12:15 pm
–He also was a big China cheerleader.–
He got taken to the cleaners in China to the tune of a $580 million fraud. Sorry, no rule of law there.
This was about the time when the hysterics here were claiming CAT was going to move from Illinois because of taxes and Illinois “corruption.”
http://www.forbes.com/sites/simonmontlake/2013/02/13/cat-scammed-how-a-u-s-corporation-blew-half-a-billion-in-china/#3071332d290e
Comment by wordslinger Monday, Oct 17, 16 @ 12:17 pm
Folks, this is a leading economic indicator. When rats flee the ship you know it’s going down. The next recession will soon be upon us. Illinois does not have long to get the bow or the stern to the wave. Right now we are broadside on.
Comment by Honeybear Monday, Oct 17, 16 @ 12:21 pm
He often talked down future company results like a certain governor we all know.
I didn’t have any confidence in his leadership and thought he should have been gone a few years ago.
Comment by A Jack Monday, Oct 17, 16 @ 12:23 pm
Word. I remember that now….Honeybear when did we leave the last one?
Comment by David Monday, Oct 17, 16 @ 12:24 pm
–Folks, this is a leading economic indicator. When rats flee the ship you know it’s going down. –
Meh, it’s a rare example of someone getting bounced for being a screwup and costing stockholders money.
I wouldn’t read global implications into it.
Comment by wordslinger Monday, Oct 17, 16 @ 12:24 pm
I see why Rauner admires him so much.
Comment by Albany Park Patriot Monday, Oct 17, 16 @ 12:35 pm
a number of CAT execs are moving on or looking to do so. Morale there is abysmal. You join a company like CAT to have a stable work life. That myth has been busted for union folks for quite a while, but management has been largely immune, not so now. Best of luck to the new CEO and I hope theres enough talent left to rebuild with, cuz CAT, like the brain drain caused by higher ed budget impasse, is eating its seed corn. Doug and Bruce may have VERY parallel legacies…… sad.
Comment by Anonymous Monday, Oct 17, 16 @ 12:40 pm
Cat joins everbody else including the state and universities. This guy made it worse. I can’t stand what he did but it’s still bad news to have our largest manufacturer in this situation.
Comment by David Monday, Oct 17, 16 @ 12:48 pm
Where is there an impaired, wheel chair bound graphic artist when you need one?
Comment by Tommydanger Monday, Oct 17, 16 @ 12:54 pm
Mike Madigan and the big yellow assembly lines he controls.
Comment by Give Me A Break Monday, Oct 17, 16 @ 1:03 pm
Oberhelman was a nightmare, running the most visionary company of 1962. No concept of changing commodities markets vis-a-vis environmentalism and global warming; no concept of the need to be nimble and responsive in the 21st century. Just a big lumbering company planning for the glories days of American manufacturing and resource extraction. Hearing his client presentations was sort of horrifying as he seemed unaware it was 2016 and the world had changed.
Comment by Educ Monday, Oct 17, 16 @ 1:17 pm
Maybe now he can go back to that old gig repossessing cars in Decatur he was so fond of…
Comment by Shark Sandwich Monday, Oct 17, 16 @ 1:19 pm
Hey Honey! Has cat gotten any EDGE money?
Comment by Blue dog dem Monday, Oct 17, 16 @ 1:21 pm
The Forbes article is really interesting. I just looked at joy and it isn’t going well at all. It doesn’t look like far has written off the not aquisition yet. It’s still valued at 50 billion 47 times earnings 10 billion more than its declining revenues. ….oof
Comment by David Monday, Oct 17, 16 @ 1:21 pm
Doug bet on China and lost.
Next up.
Comment by Michelle Flaherty Monday, Oct 17, 16 @ 1:30 pm
Mr. oberhelmen was also wrong that Bruce Rauner would be good for Illinois, when he proclaimed, “we’re all in.”
It appears Doug likes being “all in” without regard to the consequences.
Comment by Winnin' Monday, Oct 17, 16 @ 1:46 pm
Another “successful” businessman.
He should run for office to translate that success into improved government!
Comment by Sir Reel Monday, Oct 17, 16 @ 2:00 pm
He will be the case study for why CEO compensation will be regulated. He’s set for life after hurting thousands of families.. I’m sure he won’t be welcomed back in Peoria.
Comment by Almost the Weekend Monday, Oct 17, 16 @ 2:14 pm
–Hey Honey! Has cat gotten any EDGE money?–
I don’t have time to look but here is the public reporting on EDGE through 2015. I found this report buried on the DCEO site. Took me forever to find it. I had been interested in EDGE because it’s how I figured Rauner was going to reward his backers.
https://www.illinois.gov/dceo/AboutDCEO/Pages/ReportsRequiredByStatute.aspx
Comment by honeybear Monday, Oct 17, 16 @ 4:05 pm
- “Doug bet on China and lost.”
Actually Doug bet on China and Caterpillar lost.
Doug made himself about $20 million a year while he ran Caterpillar into the ground and the Caterpillar board approved bonuses.
Doug is just fine, Caterpillar, not.
Comment by Anonymous Monday, Oct 17, 16 @ 6:17 pm
Cat was going for China big before DO became CEO.
Comment by Slippin' Jimmy Monday, Oct 17, 16 @ 8:05 pm
Doug bet on China, fracking, and high oil prices. Call it a trifecta.
I agree with word. The sky ain’t falling.
Comment by Arthur Andersen Monday, Oct 17, 16 @ 11:26 pm