Caterpillar Inc. is now not only a leading maker of forestry equipment but also the industry’s largest dealer in the southeastern United States.
The Illinois-based construction machinery giant has purchased Pioneer Machinery Inc., a South Carolina-based, family-owned firm that had accounted for nearly half the current forestry products sales in West Virginia, Virginia, North and South Carolina and Florida.
Pioneer Machinery will focus on forestry products sales, while the Cat dealers in each of those states will give up that part of the business but will acquire a “substantial ownership position” in the new operation, the company said.
“In effect, Pioneer becomes a new Cat dealer offering only forestry products and services to customers through the six southeastern states,” Caterpillar’s announcement said.
“We welcome Pioneer Machinery into the Caterpillar dealer family, and we look forward to working with them,” Joe Blanchard of Blanchard Machinery said in a letter to that firm’s customers.
Columbia-based Blanchard is the franchise holder for Cat’s entire line in South Carolina and said it will be a major shareholder in the new operation.
“I want to let you know that Blanchard Machinery, Pioneer Machinery and Caterpillar will continue to provide the very best products and services as we transition into this dedicated Cat forestry dealership,” Blanchard said. “We will better serve our forest customers with this change of coverage.”
John Pfeffer, vice president in charge of Cat’s North American Commercial Division, said the move has received wide support from Cat dealers around the region.
“Our goal is to become the primary supplier for forestry products and attachments,” Pfeffer said. By creating a new “regional dealership, our dealers will be able to provide customers with better coverage and industry-specific services as they become the one-stop source for all the equipment needed by those involved in felling, processing, extraction and handling operations.”
Based in West Columbia, SC, Pioneer has grown from a single store in 1967 to 29 stores and 450 employees. The current management team, including president and owner Joseph Garner Scott, will continue to operate the new company, Cat said.
In addition to Cat’s own offerings, “Pioneer brings several core capabilities to the acquisition, including a complete forestry product line of industry-leading manufacturers, and dedicated forestry sales and service professionals,” Cat said in its announcement.
Caterpillar Inc. has doubled its own forestry product offerings in the past five years, the company said, and this acquisition “adds a well-developed territory covering the six states, a seasoned support system, a financial base that will give the new dealer additional strength and a growing forestry product line.”
No purchase price was announced. The deal also includes two affiliates, used-equipment vendor Ironmart Inc. and Federal Financial Inc.
Caterpillar dealers are working now to explain the deal to their customers.
Blanchard Machinery, for example, will continue to provide parts and service support to Cat Forest Products customers until that part of the operation is transferred to Pioneer. Users of the other Cat lines will remain with Blanchard after that.
For instance, if someone runs a Cat skidder and Cat dozer, Blanchard’s Mike Love said, “You will continue to receive quality parts and service support for both pieces of equipment from Blanchard Machinery. However, Pioneer will eventually provide you with parts and service support on your Cat skidder and Blanchard will provide support for your dozer.”
Love said the company also would honor any outstanding quotes on Cat equipment, but suggested customers contact their Blanchard sales representatives as soon as they can.
All Cat Forest Product models are involved, including wheel skidders models 515, 525, 535B and 545; track skidders models 517 and 527; knuckleboom loader model 539; log loaders models 320 B, 322B, 325B and 330B; delimbers models 320B FM, 322B FM, 325B FM and 330B FM; forwarders models 554 and 574 and harvesters models 550, 570 and 580.
The Pioneer deal represents a new strategy for Cat, its executives said.
“The acquisition of a distribution company is a different type of acquisition for Caterpillar, but it fits well with our strategy to become clearly focused on our customers and their industry segments, and to improve dealer account attractiveness,” said Gerald Shaheen, Caterpillar Group president.
“The acquisition of Pioneer will help us better serve our forestry customers and provides the necessary critical mass to provide dedicated forestry coverage with an acceptable profit level,” Shaheen said.
Pioneer began operations in 1967 as Pioneer Logging Machinery Inc. with a single location in downtown Columbia. Its South Carolina operations grew steadily and Pioneer moved its headquarters to adjacent Lexington County in 1974 before expanding across state lines with the opening of five new operations in north and central Georgia in the 1970s and 1980s.
During the l990s, the company expanded into southern Georgia and northern Florida and also opened two branches in North Carolina. In 1998, Pioneer bought S&M Equipment Corp. of Richmond, VA, which gave it operations in West Virginia, Virginia and four more branches in North Carolina.
It moved its headquarters from Lexington to nearby West Columbia in early 1999.
Blanchard Machinery, meanwhile, is the exclusive dealer for Caterpillar equipment and Cat industrial, truck and marine engines in South Carolina. It’s headquartered in Columbia with branches in Greenville, Rock Hill, Florence, Myrtle Beach and Summerville.
This story also appears on Forestry Equipment Guide.
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