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Caterpillar Sinks as China Warning, Cost Worries Pile Up

  • Higher manufacturing costs, goodwill hurt quarterly profit
  • CEO Umpleby warns China demand will fall below 2022 levels
Updated on

Caterpillar Inc. shares are heading for the biggest drop in four months as investor worries mounted on warnings of weaker China demand and rising costs for the maker of iconic yellow bulldozers.

The company said sales of its machines in China will be softer this year, a sign of cooling expectations in the world’s second largest economy. The revelation came after the US maker of heavy equipment for the mining, construction and energy industries posted lower-than-expected quarterly profit for the first time since the start of the pandemic, thanks in part to unfavorable raw material costs.