Caterpillar Inc. (NYSE:CAT) is betting on the autonomous driving tech that can be included in existing machines in a bid to bridge the slump in truck and bulldozer sales during the pandemic. The use of autonomous technology will help the company mitigate the impact the COVID-19 pandemic has had in sales on its conventional workhorses.
Demand for autonomous machine growing
The pandemic has changed how small and large enterprises seek to protect operations from disruptions in the future. As a result, there has been an increase in demand for machines that don’t require human operators. Caterpillar has seen a surge in demand for autonomous tech for mining operations by double digits compared to last year. This is according to unreported data that Caterpillar shared with Reuters.
On the other hand, yellow bulldozer, mining trucks, as well, as other equipment sales, have been on the decline in the last nine months. This trend has also been experienced by competitors such as Deer & Co and Komatsu Ltd.
The company’s global product manager for construction digital and tech division, Fred Rio, said that remote-controlled equipment would be available at construction sites from January. He said that the remote-control tech enables users to man machines at construction sites from miles away. Caterpillar is also collaborating with space agencies to employ satellite tech, which will allow someone in the US to control machines at sites anywhere across the globe remotely.
Caterpillar has been pursuing automation technology since 2017
It is important to note that the automation strategy of Caterpillar was not born during the pandemic. The company has been investing in automation technology since 2017, when it emerged from its longest clampdown. This is part of its plan to enhance recurring revenue from sales of services. However, it is still early, and such tech is still a niche part of Caterpillar’s operations. Although the company doesn’t break revenue from its tech sales, the demand surge is unlikely to significantly impact its revenue, which was $54 billion in 2019.