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June 2011www.marinelink.com 73Maritime Reporter recently had the op- portunity to tap a trio of executives ? Nigel Parkinson , GM, Caterpillar Ma-rine Power Systems, Florian Gruber, Di-rector, Global Sales and P. Jaime Tetrault , Director, Global Product Sup- port ? from one of the largest and wide spread marine power brands in the world, Caterpillar, for insights on a range of topics from technology to market development. Please provide an overview of the offerings of CAT Marine. Parkinson: Caterpillar Marine Power Systems (CMPS), with headquarters inHamburg, Germany, was created in 2003 to bring together all sales and service ac-tivities for Cat and MaK branded marine products within Caterpillar Inc. This or- ganization provides marine power solu- tions (high and medium speed engineswith outputs from 11 kW to 16,000 kW)and customer service from a singlesource for the global marine market. CMPS coordinates and strives to improve all marine sales and service activities with one simple goal: to ensure our cus-tomers satisfaction in a consistent man- ner. Our objective is to serve as an innovative market leader in the high-speed and medium-speed marine diesel engines inall segments in which we participate. We have consolidated the Cat and MaK en- gine capabilities into one organization to combine our forces and harness the syn-ergies that will deliver our strategic ob- jectives. One organization ? two brands: This philosophy embraces huge efficien- cies and strengthens our position.How has the global economic slowdown affected the business of CAT Marine? Gruber: The multiple industries Cater- pillar as a corporation serves were among the hardest hit during the trough and themarine industry was not exempt from the negative downturn of the economy. De- spite the economic difficulties, we deliv- ered stable results, invested for the future and continued to strengthen our founda-tion for growth. Has it affected your strategy? Parkinson & Gruber: Our strategy to deliver excellence on board to our cus- tomers has not wavered in spite of market conditions. We understand our cus- tomers bottom line may have potentially been impacted by the trough and have strategically remained focused on devel- oping solutions catered to help them de-liver exceptional results. We are committed to remaining a market leader in the marine industry and strive to build long-term partnerships with our cus-tomers. Understanding our customerskey value propositions has guided Cater- pillar Marine Power Systems to engage in a strategically-segmented approach to the marine industry and adjust to our cus-tomers short-term needs. Our long-termstrategy to identify and develop emerg- ing markets as well as become a more complete provider of systems solutions has not changed as a result of the eco-nomic conditions. Tetrault: In fact, the economic situation in marine was a catalyst for developing a robust Product Support/Aftermarket strategy. Recognizing that a market shift was upon us, we pulled together our product support experts and developed a strategy to define the metrics and processes necessary to achieve our goal of Product Support excellence. As related to the aftermarket sales, CMPS has also seen a downturn in opportunity for parts sales. However, through deployment of our Product Support Strategy which fo- cuses primarily on dealer service capa-bilities, weve been able to maintain our positive parts sales trends and even in- crease our net sales. Where do you see recovery in the marine business, by global region and/or by mar- ket sector? Gruber: Globally, we have seen a strong growth surge in emerging markets, par- ticularly Asia and Brazil, and we are looking to maximize our opportunities inboth of those markets from a prime sales and product support standpoint. From theperspective of the market sectors, the rate of recovery varies. For example, the off- shore sector is performing well, leverag- ing the strength of the oil and gasindustry. On the other hand, the pleasure craft sector was impacted quite heavily by the recession and has a longer road torecovery. Fortunately for Caterpillar, we can rely on our product support benefits and services, such as Cat Financial, tooffer our customers flexible options. Tetrault: In the aftermarket business, marine operators have been postponing scheduled and preventative maintenance in an effort to defer costs. This has re- sulted in a shift of opportunity into 2011and 2012. However, it has also increased the number of major repairs each year. Strangely enough, the volume of parts sales lost to the postponement of mainte-nance is easily matched with the volume gained in large part sales. This is an indi- cator to Caterpillar that from a macro per- spective, postponing maintenance isnt a long term solution to cost avoidance. Ul- timately, we want to work with our cus- tomers in extending maintenance intervals based on conditions internal to the engine which would indicate that it is possible to run for a longer period of timewithout effectuating a maintenance event. What are the critical market forces that help to shape your product and services? Gruber:The key market forces driving the marine industry are emissions regu- lations and increasing overall fuel effi- ciency. Now more than ever, customers are demanding complex, customized so- lutions tailored for their marine applica-tions. This is largely in part due to the varying emissions regulations around the globe that are becoming increasinglystringent. Additionally, many of our ma- rine customers are become more andmore global in terms of their operationsand need global service solutions for theirvessels, even in the most remote loca- tions. Tetrault: From a product support per- spective, heightened competition from the grey market? has increased our focus on differentiating the value of original equipment and parts. We feel it is impor- tant to improve our communication to our customers on the differences between our original equipment and the grey market suppliers. Additionally, today our customers are be- coming much more global, and thus areexpecting more consistent product sup- port capabilities from the Cat dealer. As a result, this globalization has driven an increased focus by CMPS on increasingthe global service capabilities to a com-mon high level. This is being done through a process of evaluating the serv- ice capabilities of these dealers leverag- ing a metrics based process called theMarine Service Assessment. This assess- ment focuses on the customer experience in the service space, and thus the mostimportant touch point. Globalization has been a blessing for our customer supportbusiness, as it highlights the value of the Cat distribution network, both in terms of dealers and parts. We still have a way to go to achieve what we consider Product Support Excellence, however, this shift in market forces and globalization has helped us in our strategy development. How is CAT investing today in its marine products and services to better position it for future success? 2011 YEARBOOKMARINE PROPULSIONGlobal Expansion of CAT Power, Service Emissions regulations are becoming increasingly challenging in NorthAmerica and globally.In order to address these needs, Caterpillar has been working closely with the US EPA and has successfully developed what we call Emissions upgrade kits.? The goal of these kits is to allow our customers the option to reduce vessel emissions without having to replace the engine. Nigel Parkinson, GM
