caterpillar remanufacturing . example 05

Over the past 40 years, Caterpillar's remanufacturing and remanufacturing business has grown and expanded significantly to employ 3,600 people worldwide. Thanks to Cat Reman, the company was able to increase its margin while continuing to manufacture the highest quality components, replacing components before they failed and remanufacturing them from a mix of new and reused.

The circular economy framework emphasizes the importance of designing efficient products and systems rather than focusing solely on performance. Caterpillar applies this strategy to the design of its own products and, rather than trying to use ever less material, Caterpillar is increasing the number of parts, components and subassemblies that can be remanufactured multiple times. In addition Caterpillar estimates that 35% of its costs are overhead and therefore the vast majority of its costs are material related. Thus, saving materials provides a competitive advantage over competitors for whom the focus is often on reducing overhead.