Caterpillar has seen its order backlog for cold-climate equipment rise by 12% year-over-year, driven in part by new Arctic defense and mining projects in Greenland. With US and NATO members planning over $1.8 billion of new infrastructure spending in northern latitudes through 2028, CAT’s cold-weather line—which includes insulated engine enclosures and low-temperature hydraulic systems—accounts for roughly $450 million of fiscal 2025 sales. Management projects that Arctic-grade equipment will contribute an incremental $75 million to revenue in fiscal 2026.

While Caterpillar and Volvo CE face similar headwinds from a 5% Europe-US machinery tariff hike implemented last quarter, CAT has allocated $320 million to advanced automation and remote-operation features this year—30% more than Volvo’s $245 million commitment. CAT’s investment is already yielding results: its recently launched semi-autonomous excavator series has secured 85 pre-production orders valued at an estimated $68 million, compared with Volvo’s 60 units at $48 million.

As hyperscale cloud providers plan to add 35 gigawatts of IT capacity globally in 2026, power-generation modules for on-site backup have become a higher priority. Caterpillar’s generator sales to data center developers grew by 18% in Q4, representing $120 million in revenue. The company forecasts a further 22% increase in generator orders for 2026, supported by an expanded product lineup featuring new 2.5 MW units that target edge and campus-scale facilities.