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2019 | Sustainability Report
Caterpillar's Environmental,
Social and Governance Approach

SASB Code: RT-IG-440b.1

For more than 45 years, Caterpillar’s remanufacturing and rebuild businesses have provided customers with quality equipment that delivers the best economic proposition for their business. Our engineering and manufacturing expertise, field population and dealer organization make it possible for us to offer remanufactured products and components through Cat® Reman, Progress Rail Services and Solar Turbines, and rebuild options through our dealers.

Remanufacturing and rebuild options deliver multiple sustainability benefits and help Caterpillar contribute to the circular economy. Through these businesses, we recycle millions of pounds of end-of-life iron annually. Because we are in the business of returning end-of-life components to same-as-when-new condition, we reduce waste and minimize the need for raw material, energy and water to produce new parts. Through remanufacturing, we make a significant contribution to sustainable development — extending the value of the energy and water consumed in a component’s original manufacture and keeping high-value nonrenewable resources in circulation for multiple lifetimes.

Given the significant role that remanufacturing and rebuild operations play in our sustainability initiatives, we set a goal to grow remanufacturing and rebuild business sales by 20% from 2013 to 2020. With the company’s enterprise strategy focused heavily on expansion of services, we are experiencing a steady demand for remanufactured products and components.

Remanufacturing and rebuild businesses take a systems view of product life cycles. For example, the Cat® Reman process begins with new product design. Engineers use design guidelines to build key products with remanufacturingin mind, ensuring they are highly durable even under heavy-use conditions. When a component reaches the end of its initial serviceable life, dealers return the used component, referred to as core, to Caterpillar where it is cleaned, inspected, salvaged and remanufactured to original factory specifications, including any engineering updates. The company uses state-of-the-art salvage techniques, strict reuse guidelines, and advanced remanufacturing processes and quality controls to ensure reman products provide same-as-when-new performance, coupled with a same-as-new warranty.

Cat Reman products are supplied to dealers, who sell them to customers at a significantly reduced price compared to the cost of an equivalent new product. Cat Reman’s model is an exchange business. To encourage use of reman product, we charge a deposit along with the purchase of each reman product. When customers return their used components, we refund their deposit. Caterpillar uses a proprietary core management system to globally manage core returns from dealers and Caterpillar inspection facilities and determine the core credit amounts that will be refunded. Off-the-shelf availability of nearly 8,000 parts gives customers more options at repair and overhaul time.

A rebuild is typically performed by trained dealer service professionals using genuine equipment and parts that literally “rebuild” a customer’s machine. A complete Cat® Certified Rebuild includes more than 350 tests and inspections, automatic replacement of approximately 7,000 parts and a like-new machine warranty. Caterpillar provides information, data, training and service tools to help dealers make the most appropriate decisions about which parts to reuse in order to achieve expected longevity of rebuilt components. Our remanufacturing and rebuild services greatly increase the amount of materials that remain in productive use.

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