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WSJ: Caterpillar unit loses some railcar repair contracts

  • Caterpillar's (NYSE:CAT) Progress Rail subsidiary is losing railcar repair contracts at some of the nation's busiest railroad terminals, including the ports of Long Beach and Los Angeles, WSJ reports.
  • Rival TTX is taking over railcar inspection and repair work at those ports on Terminal Island, Calif., as well as at rail hubs in San Bernardino, Calif., San Diego, Oakland, Stockton, Calif., and Glendale, Ariz.
  • The switch comes amid a federal grand jury investigation in California, disclosed last year, into whether Progress Rail charged railcar owners for repairs that weren't necessary and improperly disposed of discarded parts.
  • The loss of the contracts likely will hit Progress Rail's revenue, which totaled ~$1.2B when CAT acquired the company in 2006; Progress Rail's service business represents less than 4% of CAT's annual revenue.
Comments (3)
  • rado403
    , contributor
    Comments (41) | Send Message
    Where id the Board of Directors? Who is in charge? CAT lost their home state locomotive deal--The board needs to be cleaned up. Now!
    4 Sep, 07:53 PM Reply Like
  • catcj4
    , contributor
    Comment (1) | Send Message
    As a retired Cat manager, I would have been let go for this type of performance in my business unit. Billy Ainsworth, VP and founder of Progress Rail has got to go. Cat CEO Doug Oberhelman would never accept this violation of Cat values from his executive team. Sounds like the good old boy network is alive and well in the executive office suites at Caterpillar.
    4 Sep, 09:01 PM Reply Like
  • rado403
    , contributor
    Comments (41) | Send Message
    Of all the Alpha items written about CATs brd- You are the only person to also point out the failure of Mgmt--thank you -- But why are we the only ones to be concerned?
    12 Sep, 12:47 PM Reply Like
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