BEIJING, Oct. 17 /PRNewswire-FirstCall/ -- Caterpillar (China) Investment Co., Ltd. (Caterpillar China), a wholly-owned subsidiary of Caterpillar Inc. (NYSE: CAT), and AVIC Liyuan Hydraulics Co., Ltd. have signed a joint-venture agreement to establish a company to design and manufacture medium- and heavy-duty hydraulic pumps and motors for the construction equipment industry. The joint venture will provide components for use in Cat products as well as third-party machinery and equipment. Hans Haefeli, Caterpillar vice president with responsibility for Advanced Components & Systems, and Jiming Zhu, Caterpillar vice president with responsibility for China, took part in the signing ceremony.
"We look forward to expanding our components presence in China through this venture and leveraging our expertise to become a leading supplier for Caterpillar and OEM customers in this growing market," said Haefeli. "This strategic alignment will also enhance Caterpillar's supply base and key component capacity in support of Caterpillar's machine capacity expansion plans in China."
Both parties bring expertise, technology and broad distribution capabilities to the joint venture. This new business will begin operations in Wuxi, Jiangsu Province, after receiving necessary government approvals.
AVIC Liyuan Hydraulics Co., Ltd., a wholly owned subsidiary of AVIC Heavy Machinery Co., Ltd. (600765.SSE), is the leading producer of hydraulic pumps and motors in China.
"We are looking forward to achieving our new enterprise development target through the cooperation, which will enable us to become an OEM and piston pump/motor supplier to Caterpillar, facilitating Caterpillar's effort to localize production of key hydraulic components," said Mr. Ji Suchun, general manager of Liyuan. "This alignment is also significant in serving the customer needs in China and reaching industry development."
The Caterpillar / Liyuan joint venture, once approved by the applicable regulatory authority, will be the first key components joint venture for Caterpillar in China. Through this, Caterpillar China and Liyuan will support the Chinese government's goal of equipment machinery industry revitalization by providing state-of-the-art technology and products.
"Over the last 30 years, Caterpillar has made significant investments in China to support a growing base of customers in the region," Zhu said. "The joint venture is a clear indication of Caterpillar's commitment to our customers and to the China market."
"A good beginning is half way to success. I believe the alignment will lead to further and broader cooperation going forward," said Ji.
For more than 85 years, Caterpillar Inc. has been making progress possible and driving positive and sustainable change on every continent. With 2009 sales and revenues of $32.396 billion, Caterpillar is the world's leading manufacturer of construction and mining equipment, diesel and natural gas engines and industrial gas turbines. The company also is a leading services provider through Caterpillar Financial Services, Caterpillar Remanufacturing Services, Caterpillar Logistics Services and Progress Rail Services. More information is available at: http://www.cat.com.
About AVIC Liyuan Hydraulic:
AVIC Liyuan Hydraulic Co., Ltd., a wholly owned subsidiary of AVIC Heavy Machinery Co., Ltd. (600765.SSE), is a professional enterprise to research and develop the military and civilian hi-pressure piston pump/motor. It is an authorized National High and New Tech enterprise for the national basic components industry.
Liyuan Hydraulic has successfully developed the products of 40 series 700 items to be widely used for the national aviation and spaceflight, engineering, architecture, mining, shipping, railway engine, metallurgy and agriculture machinery. It has a large sales and service network in the domestic market. The products are exported to North America, South America, Europe, Asia and beyond. For more information, please visit http://www.zhlyyy.com.
Certain statements in this press release relate to future events and expectations and, as such, constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements are subject to known and unknown factors that may cause actual results of Caterpillar Inc. to be different from those expressed or implied in the forward-looking statements. Words such as "believe," "estimate," "will be," "will," "would," "expect," "anticipate," "plan," "project," "intend," "could," "should" or other similar words or expressions often identify forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including, without limitation, statements regarding our outlook, projections, forecasts or trend descriptions. These statements do not guarantee future performance, and Caterpillar does not undertake to update its forward-looking statements.
It is important to note that actual results of the company may differ materially from those described or implied in such forward-looking statements based on a number of factors, including, but not limited to: (i) economic volatility in the global economy generally and in capital and credit markets; (ii) Caterpillar's ability to generate cash from operations, secure external funding for operations and manage liquidity needs; (iii) adverse changes in the economic conditions of the industries or markets Caterpillar serves; (iv) government regulations or policies, including those affecting interest rates, liquidity, access to capital and government spending on infrastructure development; (v) commodity price increases and/or limited availability of raw materials and component products, including steel; (vi) compliance costs associated with environmental laws and regulations; (vii) Caterpillar's and Cat Financial's ability to maintain their respective credit ratings, material increases in either company's cost of borrowing or an inability of either company to access capital markets; (viii) financial condition and credit worthiness of Cat Financial's customers; (ix) material adverse changes in our customers' access to liquidity and capital; (x) market acceptance of Caterpillar's products and services; (xi) effects of changes in the competitive environment, which may include decreased market share, lack of acceptance of price increases, and/or negative changes to our geographic and product mix of sales; (xii) Caterpillar's ability to successfully implement Caterpillar Production System or other productivity initiatives; (xiii) international trade and investment policies, such as import quotas, capital controls or tariffs; (xiv) failure of Caterpillar or Cat Financial to comply with financial covenants in their respective credit facilities; (xv) adverse changes in sourcing practices for our dealers or original equipment manufacturers; (xvi) additional tax expense or exposure; (xvii) political and economic risks associated with our global operations, including changes in laws, regulations or government policies, currency restrictions, restrictions on repatriation of earnings, burdensome tariffs or quotas, national and international conflict, including terrorist acts and political and economic instability or civil unrest in the countries in which Caterpillar operates; (xviii) currency fluctuations, particularly increases and decreases in the U.S. dollar against other currencies; (xix) increased payment obligations under our pension plans; (xx) inability to successfully integrate and realize expected benefits from acquisitions; (xxi) significant legal proceedings, claims, lawsuits or investigations; (xxii) imposition of significant costs or restrictions due to the enactment and implementation of health care reform legislation and proposed financial regulation legislation; (xxiii) changes in accounting standards or adoption of new accounting standards; (xxiv) adverse effects of natural disasters; and (xxv) other factors described in more detail under "Item 1A. Risk Factors" in Part I of our Form 10-K filed with the SEC on February 19, 2010 for the year ended December 31, 2009 and in Part II of our Form 10-Q filed with the SEC on May 3, 2010 for the quarter ended March 31, 2010. These filings are available on our website at www.cat.com/sec_filings.
SOURCE Caterpillar Inc.