Caterpillar Inc, the world's largest maker of tractors and excavators, said on Monday the global economy is slowing faster than it had expected and slashed its 2012 forecast for the second time this year.
The company's retail dealers are selling off inventories, rather than buying new machines, forcing Caterpillar to idle some production, executives said.
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"As we've moved through the year, we've seen continued economic weakening and uncertainty," Chief Executive Doug Oberhelman said in a statement.
The statement came despite better-than-expected third-quarter profit on a rebound in U.S. sales of heavy equipment to repair crumbling infrastructure. Europe and parts of Latin America remained tough regions for Caterpillar.
For the third quarter, the company posted profit of $1.7 billion, or $2.54 per share, compared with $1.14 billion, or $1.71 per share, in the year-ago period.
Excluding one-time items, the company earned $2.26 per share. By that measure, analysts expected earnings of $2.22 per share, according to Thomson Reuters I/B/E/S.
Revenue rose 5 percent to $16.45 billion. Analysts looked for $16.77 billion.
For 2012, the company now expects to earn $9 to $9.25 per share on sales of $66 billion. The company had looked for about $9.60 per share.
Analysts estimated 2012 profit of $9.40 per share on revenue of $67.64 billion.
In July the company also cut its 2012 forecasts.