CAT · 10-Q · 2026Q2 · Full report

Trade Policy and Tariffs

CATERPILLAR INC · 2026-08-05 · Importance 65 · Surprise 60 · In source text

On February 20, 2026, the U.S. Supreme Court ruled that tariffs imposed under the International Emergency Economic Powers Act (IEEPA) on goods imported into the United States were unauthorized. Caterpillar incurred approximately $1.0 billion of IEEPA tariff costs during 2025 and until U.S. Customs and Border Protection stopped collecting the tariffs in 2026. During the second quarter of 2026, CBP launched the CAPE system for certain IEEPA refund claims, and Caterpillar recorded $392 million of expected recoveries for claims submitted and accepted during both the three- and six-month periods ended June 30, 2026. Additional claim submissions and the timing and amounts of any further recoveries remain uncertain and were not considered probable at June 30, 2026.

Key facts

• On February 20, 2026, the U.S. Supreme Court ruled that IEEPA tariffs were unauthorized; during 2025 and until CBP ceased collecting IEEPA tariffs in 2026, the company's total IEEPA tariff costs were approximately $1.0 billion. source
• During the second quarter of 2026, CBP launched the CAPE system, which enabled submission of certain IEEPA refund claims. source
• The MD&A identifies "the imposition of new tariffs or changes in existing tariff rates" as a factor that could affect demand for Caterpillar's products and competitive position. source

Impact estimates