Caterpillar Learned A Good Lesson

(1/21/2013) China's huge market and cheap labor seems to be too good to let go. Many international conglomerates rushed into China to set up their new branches, or to acquire business in order to beef up their competitiveness. Well, Caterpillar learned a good lesson that the Chinese company SiWei they bought was a lemon. This terrible purchase forced Caterpillar to write down a loss of $580 millions in the fourth quarter in 2012. This $580 millions of loss is almost 89% of its original merging cost ($653 millions). Ironically, the two business men who sold Siwei to Caterpillar and made huge profit are American, as this news says " Emory Williams is a former chairman of the American Chamber of Commerce in Beijing. The other principal is James Thompson III, the son of billionaire James E. Thompson, chairman of Crown Worldwide
Group, a relocation company in Hong Kong." Forbes has revealed that merge in 2011.