Excavators Transforming Into Computerized Data Machines—The Digital Future of Heavy Industrial Machinery and Equipment
The heavy industrial machinery and equipment (M&E) sector is going through a transition from a product-led operating model to customer-centric solutions enabled by advanced computerized systems and data analytics. While digitalization has been a strategic focus in the last decade, it has now entered rapid progression after the Coronavirus Disease (COVID-19) pandemic. The manufacturers are not only making smart, sophisticated products but are applying advanced machine intelligence to create value for their customers. We believe that a strong digital business plan, coupled with superior execution, is necessary to support strong credit profiles in the medium-to-long term. However, the transition from a product-led business model to digital solutions is paved with heighted financial and implementation risks and intense competition from both M&E makers and digital technology companies without physical assets.Key highlights:
-- Under the solutions model, the heavy M&E makers will not compete only on price and product support but on process improvements and efficiencies generated for customers in areas such as safety, productivity, site management, procurement, and sustainability.
-- Successful implementation of the digital business model will likely have positive credit rating implications through protection or increase of market share, stronger profitability from service differentiation and efficient applications, and stable cash flows. Issuers displaying complacency could lose their competitive footing versus peers.
Caterpillar is a manufacturer of construction and mining equipment, diesel and natural gas engines, industrial gas turbines and diesel-electric locomotives. The company segments include: Construction Industries, which supports customers using machinery in infrastructure, forestry and building construction; Resource Industries, which supports customers using machinery in mining, heavy construction, quarry and aggregates, waste and material handling applications; Energy and Transportation, which supports customers in oil and gas, power generation, marine, rail and industrial applications, including Cat? machines; and Financial Products, which provides financing and related services.
Toromont Industries delivers capital equipment to a range of customers and industries. Co. operates through two business segments: the Equipment Group and CIMCO. Through its Equipment Group, Co. is engaged in the supply of mobile equipment and industrial engines and provides sales and rental solutions as well as product support through Toromont Cat, Battlefield – The Cat Rental Store and SITECH Mid-Canada Ltd. in Ontario, Newfoundland, Manitoba and most of Labrador and Nunavut, and AgWest Ltd. in Manitoba. Through CIMCO, Co. is engaged in the design, engineering, fabrication and installation of industrial and recreational refrigeration systems with operations in Canada and the U.S..
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