Caterpillar Inc named company veteran Doug Oberhelman, head of its engines and turbines unit, to succeed retiring chief executive Jim Owens.

Oberhelman, 56, will assume the transitional titles of vice chairman and CEO-elect on January 1, the world's largest maker of earth-moving construction and mining equipment said on Thursday. He will assume Owens' titles of chairman and CEO following the company's annual meeting next June.

Like Owens, Oberhelman, who oversees Caterpillar's engines and turbines division, is a lifelong Caterpillar employee. He joined the company in 1975, worked in South America and Asia, and served as chief finance officer between 1995 and 1998 -- a position that Owens also held.

He's an excellent choice, said Eli Lustgarten, an analyst at Longbow Research. He's a terrific operating manager, very experienced, did a fabulous job in the engine business ... and has a very strong reputation as a cost-cutter.

Owens, 63, is approaching his 64th birthday and Caterpillar requires CEOs to step down at 65. Owens was pushing the board to name a successor well before then to ensure a smooth handover.

The list of possible successors was always short. Since its founding in 1925, Caterpillar has never looked outside to fill its CEO seat. In early August, at a meeting for analysts, Owens made it clear the process would be an internal affair once again.

Oberhelman grew up in Woodstock, Illinois, the son of a salesman in the local John Deere dealership.

During the early 1980s, when he was stationed in South America, Oberhelman fished the Paraguay River and was taken by the wildlife he saw. Two decades later, he returned -- and was stunned by how much things had changed for the worse.

Oberhelman has called the trip a wake-up call that made him not only a conservationist but a green champion within the company. His advocacy helped push Caterpillar into joining the Great Rivers Partnership, an effort to protect the Mississippi, Paraguay-Parana and Yangtze Rivers.

(Reporting by James B. Kelleher, editing by Gerald E. McCormick and Derek Caney)