Agile Cat

William Blackie, 61, board chairman of Caterpillar Tractor Co., stood in shirtsleeves under a light rain last week, watching a giant yellow tractor rumble through dense woods near Peoria, 111. As the machine darted and bucked, its blade ripped into an expanse oi full-grown oak trees, toppling them like so many toothpicks. Within 40 minutes, an area the size of a football field was cleared for farming. "Our machines are kind of dramatic," allowed Blackie, and the 50 other spectators could only agree. On hand for a three-day land-development conference sponsored by the Peoria-based company, they were witnessing the kind of prowess that has made Cat a $1.5 billion-a-year operation and the world's biggest manufacturer of earth-moving equipment.

Behind the conference, attended by consulting engineers and World Bank and United Nations representatives, lay Caterpillar's high-minded-and shrewd --concern with the plight of developing nations, which must start clearing their underdeveloped land if they are to meet the food needs of their burgeoning populations. Dramatizing the role it can play, Cat recently completed a test project in Costa Rica demonstrating that modern equipment can clear the densest jungle thicket for about $50 an acre; with older methods, the cost can run as high as $500. Beyond immediate clearing jobs, Caterpillar can expect to reap long-range benefits from seeing foreign countries become agriculturally self-sufficient. Explains Blackie: "If they don't have to import wheat, they can import machinery."

Scottish Burr. Concern with foreign markets is a hallmark of Caterpillar's recent management. A decade ago the company did no manufacturing overseas; today it has plants in eleven foreign countries. With foreign sales now accounting for 45% of its business, Cat has become the U.S.'s second biggest exporter after General Motors, last year helped shore up the nation's strained balance of payments with $444 million in foreign-earned revenue. The company now manufactures 250 different pieces of heavy-duty equipment, from pipelayers (cost: $96,000) capable of lifting 100 tons to giant scrapers (cost: $148,000) that can gulp 54 cubic yards of earth in a single sweep.

Such muscular diversification is all the more impressive since Caterpillar traces its origins to a single product. The original steam-driven Cat was developed in 1904 by a Californian named Benjamin Holt, who got the novel idea of mounting a tractor on its own treadmill tracks. So successful was Holt's "crawler" concept that it inspired the British invention of the armored tank during World War I.

In 1930, when Caterpillar was slowing down with the rest of the economy, Bill Blackie left his native Scotland for the U.S., where he became an accountant with Price Waterhouse & Co. in Chicago. Since Caterpillar was one of his clients, the urbane Blackie found himself spending plenty of time at the company's headquarters. "Peoria," he recalls with a slight Scottish burr, "was something I'd not quite experienced before." He evidently liked the experience, for in 1939 he quit Price Waterhouse to become Cat's controller. He moved to president in 1962, and last year, when Harmon Eberhard stepped down after four years as Cat's chairman and chief executive officer, Blackie took over the top job.

Tapping the Oyster. Having more than tripled its earnings in five years (to $158 million in 1965), Caterpillar slipped slightly last year. As a capital-goods manufacturer susceptible to economic swings, Cat suffered during the recent downturn from lagging construction, tight credit and curtailment of federal road-building projects. By 1970, however, a four-year, $600 million expansion program will be completed to meet an anticipated surge in worldwide construction, and land development. Says Chairman Blackie: "We have adapted our organization in a manner which treats the world as our oyster."

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