July 13, 2022
In the spring of 2022, Caterpillar customer Mr. Ma completed the® refurbishment of his own Cat equipment with the help of Cat® financing services. The refurbishment helped the Cat 349D excavator, which had been in operation for many years, improve performance and reduce fuel consumption, allowing it to prepare for the new year’s peak engineering season with optimal equipment condition. At a time when business sustainability is increasingly focused, more and more customers are looking to financing solutions that will save working capital and facilitate equipment recycling.
More than 40 years ago, Caterpillar has been working globally to help customers grow with financing services. In 2004, Caterpillar established Cat Financial Leasing Co., Ltd. in Beijing to provide customers with a variety of financing services including operating leases, financial leases, accounts receivable management, as well as a comprehensive equipment protection program to support the purchase or lease of Cat equipment. Many individual and SMB customers own one or more Caterpillar equipment through Cat Financing.
In the past five years, service has been an important focus in the implementation of Caterpillar’s corporate strategy. In the context of the continuous emphasis on environmental responsibility and efficient use of resources by society as a whole, Caterpillar is fully developing innovative technologies and value services to support the long-term success and sustainability of its customers. New service initiatives such as financing for refurbishment of equipment and new power upgrades have emerged in this context.
Financing refurbished equipment
With advanced technology, Caterpillar refurbishment services can restore old equipment to a state no less than new products, and even upgrade some equipment. Compared with the purchase of new equipment, the renovation of old equipment is not only less costly, but also avoids material waste and environmental pollution caused by equipment scrapping, which is in line with the concept of sustainable development.
The winter of the off-season is a good time for maintenance and refurbishment of old equipment, but cash flow pressures often make it difficult for customers. After the winter of 2021, Mr. Ma, a northwestern customer, wanted to use the shutdown period to renovate his Cat excavator, but the financial pressure made him hesitate. Upon learning of this, Cat Capital immediately contacted the local dealer and developed a financing plan for refurbished equipment that suited the customer’s needs. This not only alleviates Mr. Ma’s financial pressure, but also allows him to enjoy the preferential interest rate policy in winter. When spring comes, the excavator has a new look and is ready to be put into new work.
For some customers, financing refurbished equipment to buy used equipment is also a “good value” option. Mr. An, a Hunan customer, urgently needed a large piece of equipment to build the newly contracted project, but lacked the funds to purchase the new equipment. After learning about Cat Financing and the refurbished equipment financing services offered by local agents, he financed the purchase of a used Cat 374F excavator and then refurbished the equipment through the Refurbishment Facility Financing Project. Before the renovation, the performance of this excavator with 20,000 hours of work was no longer in the best condition, and it was difficult to meet the requirements of the work. After the refurbishment, the performance of the equipment returned to the level of no less than that of the new product. In this way, Mr. An has the most suitable equipment in the fastest speed and the most frugal way.
In order to help customers meet the current environmental protection-related laws and regulations, Cat Financing has joined hands with local dealers to launch a preferential “new power upgrade” financing plan. In 2013, Sichuan customer Mr. He purchased a Cat 323D L excavator through financing services. Today, the device has been working for more than 20,000 hours, and the internal and external components have been severely damaged and do not meet current emission standards. Mr. He chose the “New Power Upgrade” financing plan and carried out a comprehensive upgrade of the equipment.
More and more customers have completed equipment upgrades through refurbished equipment financing. During the renovation and upgrading process, the original parts of the original factory give new life to the equipment that has been in operation for many years, so that it can not only meet the requirements of the current environmental protection laws and regulations, but also allow customers to undertake future engineering projects with confidence.
Multi-level services to help customers develop
Customized financing solutions and related services are the touchstone for testing a manufacturer’s understanding of customer needs. Even the best quality equipment also needs maintenance. If there is a problem in the middle of an important project, when the funds are tight, or if the equipment fails just after the warranty period, it is a tricky situation for any customer. Cat Financing helps customers reduce unplanned maintenance costs by providing protection beyond equipment protection plans and standard warranties. For Mr. Pang, a Chongqing customer with a high level of labor and two shifts a day, this plan can give him peace of mind and help him save costs and reduce risks to a large extent. In addition, when a customer wants to transfer a device, the Device Protection Plan can also be transferred.
The safe and easy-to-use “online 24/7” service has become an important assistant for busy project customers to understand the relevant financing information. Customers can conduct online sales opportunity inquiries, electronic signatures, issuance of VAT electronic general invoices, online inquiries and other activities. For potential customers who are interested in purchasing equipment through financing, various online calculation tools can help them quickly assess their purchasing ability and repayment ability, and choose the appropriate equipment model and financing plan. Customers who already have the intention to purchase can make one-stop purchases, handle financing procedures and obtain equipment protection plan services through local Cat agents, without worry and trouble. Depending on the customer’s industry, project and funding profile, Cat Financing can also provide flexible, customized financial leasing solutions.
Caterpillar was the first foreign-funded enterprise in China’s construction machinery industry to establish a financial leasing company. In 2004, the launch of this innovative service model injected new vitality into the development of the industry. As customer financing needs continue to grow, Caterpillar established its second financial leasing services company in Shanghai in 2015. Today, Cat Financing is working closely with Caterpillar (China) Investment Co., Ltd. and local Caters dealers to innovate financial services and enhance the customer experience.
Service is an important part of Caterpillar’s corporate strategy. Cat Financing can not only provide standardized financial leasing services, but also develop exclusive financial leasing products to help customers save more liquidity. Through its global dealer network, Caterpillar provides customers with high-value services throughout the product lifecycle, helping customers build a better, more sustainable world by developing innovative products, technologies and services.
*Note: All customer cases in this article are real cases, in order to protect customer privacy, the article takes a pseudonym.