Wacker Neuson to manufacture mini excavators for Caterpillar

Wacker Neuson and Caterpillar have signed a strategic alliance that will see them work together on the design, manufacture, sale and support of Caterpillar's sub 3-tonne mini excavators.

Under the agreement, Wacker Neuson will manufacture the three affected models in Caterpillar's range at its factory in Linz, Austria. These machines will be built to Caterpillar's specifications and sold by the company's dealer network around the world except in Japan. A joint statement from the two companies said, "All Caterpillar models will be clearly differentiated from comparable Wacker Neuson models."

The companies said that by shifting production to Wacker Neuson, both companies would benefit from economies of scale by spreading the cost of manufacturing across higher volumes. Indeed, Wacker Neuson said the deal would result in more than doubling the volume of sub-3 tonne mini excavators produced at its Linz plant by about 2012. The company also said the deal would increase the number of models available in this weight category to Caterpillar's customers.

The initial term of the agreement is 20 years.