Caterpillar ships new fuel-saving diesel-electric bulldozer

Caterpillar Inc., the world's largest maker of construction equipment, began shipping a diesel-electric bulldozer today that it says can push more dirt using less fuel.

Caterpillar now must convince buyers the technology in the $600,000 D7E machine is both dependable and worth the 20 percent higher price.

"In a price-sensitive market, it will make them think twice, but you could say the same thing with the Prius," said Eric C. Orlemann, author of several books on heavy machinery, referring to Toyota Motor Corp.'s hybrid car. "You are paying for that technology."

The D7E and other new equipment, such as Komatsu Ltd.'s hybrid excavator, are part of an industry movement to save customers fuel costs with technically advanced machines.

The D7E's diesel engine drives an electric generator that is connected to electric motors, technology that eliminates some mechanical parts and reduces wear and tear, the Peoria-based company said. The tractor is as much as 30 percent more fuel efficient than the previous all-diesel model.

"What we've done is replace the mechanical transmission and torque converter with an electric generator and electric motors," David Nicoll, the D7E commercial manager, said in an interview. Customers can recoup the 20 percent price premium in two and a half years, he said.

The introduction of the dozer, which took a decade to develop, comes as customers recover from the worst recession since World War II.

"If anybody could have had a crystal ball to predict how hard the world would change just in 12 or 14 or 16 months, I would imagine there would have been a different timing of the release," said Darrin Drollinger, a vice president at the Association of Equipment Manufacturers.

The acceptance of a new technology in the construction- equipment market may be similar to how auto buyers warmed up to hybrid cars, said Jeff Windau, a St. Louis-based analyst at Edward Jones & Co.

"It took 10 years for them to get several percentage points of market penetration," Windau said. "It takes time, especially with new technology, for people to adopt it and to expand into the broader stream of the market."