⚠ Construction Competes on PriceModerate threat

Caterpillar (CAT) — threat to the moat

Caterpillar's construction business faces a dozen named global rivals, and in 2025 it cut price by $1.1 billion to keep pace.

Construction Industries is where Caterpillar's pricing is most exposed, and the filing says why. It names twelve global construction competitors, from CASE and Deere to Komatsu, Sany and Volvo Construction Equipment, plus regional ones including SDLG and Shantui1. Its risk factors warn that its share of industry sales "could be reduced due to aggressive pricing"2.

Construction Industries segment profit ($M)6,97520236,16520244,6752025Caterpillar Form 10-K FY2025
Down a third in two years.

In 2025 the segment's price realization was minus $1,136 million3, against positive price in Power & Energy. The segment's profit fell from $6,165 million to $4,675 million4.

Whatever the reason for each discount, the effect was a segment that sold almost as much and earned about a quarter less.

The emerging-market rivals add to it. Beyond the global names, the report says emerging market competitors compete in certain markets in which Caterpillar competes5. In construction, where machines are standardised and buyers are price-sensitive, every new entrant adds pressure on price.

The Construction Industries price line in each quarterly bridge is the thing to follow. It was positive again in the second quarter of 2026, at $309 million6; a return to negative with volume still rising would say the rivals have reset the price.

References
  1. ReportedIt names twelve global construction competitors, from CASE and Deere to Komatsu, Sany and Volvo Construction Equipment, plus regional ones including SDLG and Shantui.
    Caterpillar Form 10-K for fiscal 2025 - Item 1 business: competitive environment by segment. — FY2025 · publ. 13 February 2026 · source ↗
  2. ReportedIts risk factors warn that its share of industry sales "could be reduced due to aggressive pricing".
    Caterpillar Form 10-K for fiscal 2025 - Item 1A risk factors. — FY2025 · publ. 13 February 2026 · source ↗
  3. ReportedIn 2025 the segment's price realization was minus $1,136 million, against positive price in Power & Energy.
    Caterpillar Form 10-K for fiscal 2025 - Item 7 MD&A: consolidated results, sales and profit bridges, tariffs, dealer inventory and the 2026 outlook. — FY2025 · publ. 13 February 2026 · source ↗
  4. ReportedThe segment's profit fell from $6,165 million to $4,675 million.
    Caterpillar Form 10-K for fiscal 2025 - financial statements and notes: profit, per-share data, cash flow, balance sheet, debt, dividends and credit risk. — FY2025 · publ. 13 February 2026 · source ↗
  5. ReportedBeyond the global names, the report says emerging market competitors compete in certain markets in which Caterpillar competes.
    Caterpillar Form 10-K for fiscal 2025 - Item 1 business: competitive environment by segment. — FY2025 · publ. 13 February 2026 · source ↗
  6. ReportedIt was positive again in the second quarter of 2026, at $309 million; a return to negative with volume still rising would say the rivals have reset the price.
    Caterpillar second-quarter 2026 results release, Form 8-K exhibit 99.1 - consolidated results, cash deployment and the CEO's statement. — Q2 2026 · publ. 4 August 2026 · source ↗
Sources
Generated September 25, 2026