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    Rio Tinto Data Signals Heavy Equipment Makers' Success

    Mon, 09/26/2011 - 17:46 EDT - Seeking Alpha
    • BTU
    • CAT
    • CMI
    • David White
    • JOYG
    • RIO

    By David White:Rio Tinto plc (RIO) is one of the world’s largest mining companies. It operates globally but has a large presence in Asia, even in China. Given RIO’s relative importance as a customer, one would think RIO would get speedy service for its equipment purchases. However, the chart below from RIO’s Sept. 20, 2011, presentation indicates that this just isn’t so. As you can see from this table, the current lead times for big equipment are approximately one year longer than what's considered normal. This means there is a large, industry-wide backlog. It means big construction and mining equipment suppliers will have great businesses for a long time, even if there is a global slowdown. The growth chart of RIO mining activities below indicates that RIO, and likely many other companies, is still planning and expecting huge growth (from the Sept. 20, 2011, RIO presentation). The above RIO production volume growthComplete Story »

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