PEORIA, Ill. (AP) -- Caterpillar Inc., the world's largest maker of construction and mining equipment, said Tuesday it plans to build a new manufacturing facility in Brazil to meet growing customer demand throughout Latin America.
Caterpillar said the move is part of its long-term strategy to expand its global manufacturing operations, noting it has seen a particularly strong economic recovery in Latin America over the last year.
Caterpillar said earlier this month its machine sales worldwide jumped 11 percent in May compared with a year ago. Sales dipped 2 percent in Latin America. Because its iconic yellow-and-black equipment is used in many different sectors all over the world, the company's sales are considered an indicator of global economic health.
The company said it expects to announce a location for the plant later this summer. Construction of the new facility is expected to begin late this year or early next year, pending final site approvals.
The new facility will produce backhoe loaders and small wheel loaders, which are among the products currently made at Caterpillar's facility in Piracicaba, Brazil. Once the manufacturing facility begins production, it will allow Caterpillar to increase production for the other machines made in Piracicaba.
The plant in Piracicaba makes wheel loaders, motor graders, backhoe loaders, track-type tractors, excavators, compactors, underground mining loaders, generator sets and a variety of components.
Shares fell $2.79, or 4.3 percnet, to $61.61 in morning trading, as the broader markets tumbled.