In the face of a slowing world economy and ever-changing manufacturer alliances, Caterpillar and DaimlerChrysler have scaled down an agreement announced last year.

Caterpillar and DaimlerChrysler first announced an agreement in November 2000 to develop a 50/50 global joint alliance to develop, manufacture, market and distribute medium-duty engines, fuel systems and other powertrain components
The two companies announced Monday they have agreed to concentrate on developing long-term supply agreements for fuel systems and heavy-duty truck engines for DaimlerChrysler's North American truck unit, Freightliner. Discussions on a medium-duty engine joint venture have been deferred.
Published reports in May indicated that the two companies were finding it challenging to work out the details of their cooperative agreement. The companies had reportedly underestimated or overlooked "a number of hurdles," according to a Handelsblatt newspaper in Stuttgart, Germany, where DaimlerChrysler's headquarters are located. One of those hurdles may have been that Caterpillar competes with DaimlerChrysler's Detroit Diesel and Powersystems subsidiaries, possibly causing some antitrust headaches.
"This agreement has been very complex, however we've made solid progress during our discussions," said Richard Thompson, Caterpillar group president with responsibility for the company's engine divisions.
Eckhard Cordes, head of DaimlerChrysler's commercial vehicle division, said discussions with Caterpillar would continue. "We want to give this relationship the necessary time to evolve in a sensible way that will benefit both companies," Cordes said.
Teams of employees from both companies are continuing to work on various engine technology and fuel systems projects.