In a large mixing bowl, measure flour, sugar and cinnamon and stir to combine. Set aside.
In medium sauce pan combine butter, water, and shortening. Bring to a boil. After mixture reaches a boil add it to the flour mixture and stir to combine. Add buttermilk, then baking soda, then eggs, then vanilla in that order, mixing in between each addition. Stir in apples.
Pour into a 15x13 inch greased jelly roll pan.
Bake at 400 degrees F for 20 minutes. Let cool for about 10-15 minutes.
While cake is cooling, make frosting by combining butter and milk in a medium mixing bowl. Microwave until butter is melted. Add powdered sugar, vanilla, and caramel sauce and stir until smooth. Pour frosting evenly over cooled cake.