Caterpillar is looking to take a bigger bite out of the heavy equipment parts market with the launch of Yellowmark.
The new Caterpillar brand will deliver a lower-priced tier of aftermarket parts for small and midsized equipment. Cat announced the new brand during its end of year press briefing in Peoria, Illinois on Nov. 16.
“This strategy is hopefully going to open us up to more customers in the aftermarket that had stopped thinking about Caterpillar as an option for parts. That’s really the bottom line,” said Nigel Lewis, Caterpillar’s vice president of the Global Aftermarket, Marketing and Brand division.
The new line of parts will be geared towards serving Cat’s construction industry customer base.
“We have a large segment of Caterpillar equipment owners that are making more short-term decisions. That’s most acute in the construction space,” said Andrew Ryan, program manager for Yellowmark. “They understand the value of genuine Cat parts, they understand long-term ROI and they understand cost per hour. But for a multitude of reasons, it doesn’t always fit their business model. That’s where Yellowmark comes in.”
Ryan explained a large portion of aftermarket buyers are turning to other, less expensive parts manufacturers to complete their repairs, which sparked the creation of Yellowmark.
While Caterpillar engineers are involved in bringing the new tier to market, Yellowmark doesn’t match the same quality level as a genuine Caterpillar product, and the parts are not rebuildable.
“It’s not the same product that came down the assembly line,” Ryan said. “We’re not suggesting it has the same durability or life. Those are the tradeoffs that are made.”
As well, Yellowmark isn’t designed to eliminate genuine or reman parts offered by Caterpillar.
“It’s an option. It’s not intended to be the only option,” Ryan said. “It’s more basic in its offering and not being sold on the dimension of high performance.”
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The new parts will be introduced throughout 2018 and available through Cat’s dealer network. At first, Yellowmark will offer repair and replacement parts. Cat plans to introduce maintenance and wear parts at a later date.
“These parts are going to be as easy to buy or easier to buy than any other aftermarket part in the world,” Ryan said.
Fixed cost repairs
Alongside Yellowmark, Caterpillar also announced a new fixed-price initiative for repairs as well as a plan to provide a repair quote within 24 hours.
The new repair strategy follows a worldwide survey of Caterpillar customers. The research revealed that about 70 per cent of customers surveyed would prefer to rebuild a component. As well, Cat’s customers would look at multiple options, and expect a quote within 24 hours.
“We’ve worked together with our dealers to package a broad range of repair and rebuild solutions,” said Troy Avery, marketing manager of the Global Aftermarket Marketing and Brand division. “For the customer, it gives them choice, it gives them options and it gives them convenience.”