Add the riots in Chile and political issues in other parts of Latin America to troubles dimming the outlook for Caterpillar Inc.
On Wednesday, the world’s largest maker of mining and construction equipment reported that its three-month rolling average sales growth in the region slowed to 4 per cent in October, matching the January data that was the weakest since mid-2017.
Latin America accounted for about 9 per cent of Caterpillar’s revenue in 2018, according to data compiled by Bloomberg. Weakness in the region accelerated the slowdown in the company’s worldwide sales growth to 3 per cent, the worst since April 2017.
“There’s the social unrest in Chile, which is an important mining market,” Larry de Maria, an analyst at William Blair, said in a telephone interview. “Argentina has a difficult political situation and Brazil hasn’t really improved the way people hoped it would improve.”
The shares fell 1.3 per cent to US$144.49 on Wednesday in New York, extending this week’s decline.
Last month, Caterpillar refrained from giving sales guidance, citing the uncertain global economic outlook. Last week, the company said it’s implementing layoffs of temporary workers at its plant in Michigan and across the globe, in line with its move to cut production to match demand.
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