Executing Our Strategy

In 2021, we continued to execute our strategy for long-term profitable growth while striving to meet strong customer demand. The three core elements of the strategy remain: services, expanded offerings and operational excellence. We invested in services and digital technologies, as well as electrification, autonomous and alternative fuel product capabilities, despite the challenging environment while meeting Investor Day targets.

Caterpillar Strategy Gear
of
Caterpillar Strategy Gear

Services Sales Reach a New High 

Ensuring an easy-to-buy, easy-to-own customer experience through eCommerce, Customer Value Agreements, repair options and rebuilds drove year-over-year double-digit services sales growth in 2021. Leveraging dealer data and telematics data from our more than 1.2 million connected assets, we generate insights by using advanced analytics and machine learning to deliver value-added services that help our customers improve safety, minimize unplanned downtime and maximize productivity. These significant achievements position us to realize our aspirational goal of doubling services sales to $28 billion by 2026. 

man and woman by service truck
man and woman by service truck

Investor Day Targets: 
Committed and Achieved

In 2021, we met our target for adjusted operating profit margin. We also met our target for free cash flow for Machinery, Energy and Transportation (ME&T). Our 2021 adjusted operating profit margin of 13.7% was achieved while investing in new product launches, services and sustainability. Meanwhile, ME&T generated $6 billion in free cash flow, in line with our targets.

Men on Worksite
Men on Worksite

Support for Customers’ Energy Transition

Customers around the world are looking to lower their carbon footprint, and Caterpillar is providing the products, technologies and services to help them achieve their climate-related objectives. In 2021, we shared several announcements that further demonstrate our commitment to supporting our customers’ sustainability goals. These announcements include a collaboration to fully power a customer’s mine with an all-electric fleet of machines for a zero-emission site, key collaboration agreements to explore hydrogen fuel cell backup power for data centers, and hydrogen fuel cell power for line-haul locomotives. We also announced a collaboration with a data center customer to provide stand-by power utilizing engines capable of running on 100% hydrotreated vegetable oil (HVO) renewable fuel and any blend level with diesel.

Train
Train

Leveraging Lean and Cutting-Edge Technology to Transform Parts Distribution

Caterpillar has continued to invest in modernizing our parts distribution network, implementing automated and autonomous solutions that work together to densify our existing footprint and form state-of-the-art, efficient ecosystems within our distribution centers across the globe. By utilizing Lean principles, deploying sustainable solutions and investing in technology, we are enhancing safety and enabling a streamlined distribution model to support customers and profitable services growth.

Warehouse
Warehouse

An Impressive Autonomy Milestone

Autonomous technology continues to revolutionize mining by delivering new productivity levels for customers and enhancing safety. In 2021, we surpassed 500 autonomous trucks using Cat Command in operation at 18 sites on three continents. With more than 4 billion tonnes of material moved with no injuries, there is no doubt about the efficacy of this technology. We’re not stopping there, as we scale this technology in construction, quarry and aggregates, and beyond to support customer safety and productivity goals.

Cat Machines at work
Cat Machines at work

Our Safest Year on record

We relentlessly strive to ensure our workforce returns home safely every day, and 2021 marked the third consecutive year that we achieved our best safety performance on record. This record underscores a deeply ingrained safety culture where every individual is accountable for their safety and those around them.

Woman in factory
Woman in factory

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