NACD DEALER REMAN CORE RETURN "SHIPPING INSTRUCTIONS" Caterpillar

NACD DEALER REMAN CORE RETURN "SHIPPING

INSTRUCTIONS"

It is the responsibility of the Manufacturing Logistics & Transportation Division to review

with the Remanufactured Products Group the effectiveness of the "Shipping Instructions"

(SELD0039-06) associated with the return of cores to designated Caterpillar facilities. These

instructions establish with dealers the shipping point (s), preferred carrier list, define who is

responsible for shipping and handling costs, and determine appropriate brokers to use as

needed. These instructions apply to all dealer core return shipments. Also, compliance is

important to assure that Caterpillar is getting the best value from our designated carriers since

we are paying the freight costs. Below is a description of the policy guidelines we request all

NACD dealers to follow.

Policy Guidelines

 1. Follow Shipping Instructions as published in our Reman Products Guide and/or on

     our Reman Web Site. In summary, ship every two weeks or sooner if 40,000 lbs. has

     been accumulated, unless a special "RAP" run or other arrangements have been

     defined for your dealership.

2. Refer to the "Approved Carriers" list on the Reman Web site for the proper carrier to

     use for your dealership.

3. Dealers should display their designated "supplier code" issued by Caterpillar on their

     Bill of Lading instead of just their dealer code to assure that we receive and record the

     freight volumes correctly. The supplier code will be added to the CMIS 2 Customer

     Profile in December 2002 to help improve the process.

4. Dealers that deviate from the recommended frequency and/or load limits could be

     subject to a debit for additional freight charges.

5. Light truckloads are not allowed unless approved by Corinth Logistics prior to

     shipment.

    6. Follow the Drop Trailer policy with Star. The normal detention policy starts after 48

hours or 2 workdays. However, Star has agreed to waive the daily Drop Trailer

charge for a period of 10 workdays to allow the dealer the opportunity to accumulate

the 40,000 lbs. and meet our shipping requirements.

7. Dealers that do not comply will receive a "Shipping Noncompliance Notification" for

the first time noncompliance occurs. The Notification will include a description of

the problem and will show your shipping volumes and the carriers being used. We

request that the data is reviewed and start following the policy guidelines to avoid a

debit for freight charges on subsequent shipments that are in noncompliance. To

assist you in defining the best way to obtain compliance in the shipping of Reman

cores, please call Barb Cramer (Manufacturing Transportation & Logistics ? 309/266-

0409), or Gene Plunk (Reman Products Corinth ? 662/286-7409).

8. Dealers will receive an annual report of their core return shipping history. We

request dealers to review this report and to regularly work with us to maintain a

shipping solution that utilizes the best combination of carriers and shipment volume.

Average pounds per load will be the dealer metric used for measuring shipping

performance.

Core Management

 Please refer to the Caterpillar? Core Management Information System (CMIS 2) Parts

Information application describing all reman part/CAF and related information. Also refer to

other CMIS 2 inquiry applications such as Customer Profiles, Inspection Reason Codes,

Inspection Line Inquiry, Add Charge Information, Entitlement Activity, Entitlement Inquiry,

CCR Inquiry, CCR Entry, Shipment Processing; Process Packaging Grief; and Reporting to

properly manage core returns and monitor inspection performance. This information will be

available to all dealers worldwide after your CMIS 2 conversion date. In the meantime,

please continue to use the current CMIS Entitlement Parts Inquiry Screen describing the list

of parts in a Core Acceptability Family (CAF) and related part number detail.

For the latest updates of Reman Policies and Core Management (SELD0122), Core

Management Systems & Operations Procedures (SELD0040), and Shipping Instructions

(SELD0039), go to the Reman website and click on Procedures and Policies (listed under

Reman Program Information).

If you have any questions regarding core return processing, feel free to call your Corinth

Dealer Service Representative toll free at (800) 537-2928 or use our e-mail address --

reman_core_operations@cat.com. For assistance with technical questions, call the Peoria

Reman Customer Satisfaction Hot Line also toll free at (888) 88-REMAN or use our e-mail

address--Reman_Help@cat.com.