Caterpillar reduces production, cancels previous 2020 financial guidance

US heavy equipment producer and plate consumer is adjusting its financial guidance and reducing production in response to Covid-19, Kallanish reports. 

Caterpillar says in a release that the pandemic is now beginning to affect its supply chain. 

“At this time, Caterpillar is continuing to run the majority of its US domestic operations and plans to continue operations in other parts of the world, as permitted by local authorities,” the company says. “However, due to uncertain economic conditions resulting in weaker demand, potential supply constraints and the spread of the Covid-19 pandemic and related government actions, Caterpillar is temporarily suspending operations at certain facilities. The company will continue to monitor the situation and may suspend operations at additional facilities as the situation warrants.”

Caterpillar did not immediately provide details on which facilities would be closed or ramped down. It also cautioned that its previously issued financial outlook for 2020 is no longer valid. 

“The magnitude of the Covid-19 pandemic, including the extent of any impact on Caterpillar’s business, financial position, results of operations or liquidity, which could be material, cannot be reasonably estimated at this time due to the rapid development and fluidity of the situation,” Caterpillar says. “It will be determined by the duration of the pandemic, its geographic spread, business disruptions and the overall impact on the global economy.”