Dive Brief:
- Deere & Co. is cutting close to 300 workers at factories in Iowa and Illinois, adding to a string of layoffs as the agricultural equipment giant copes with a slowdown in sales.
- In Illinois, the company is laying off 287 employees effective Jan. 3, including 200 workers at its Harvester Works combine factory in East Moline, and 7 workers at its Seeding and Cylinder operations in Moline.
- An additional 80 employees at Deere’s Davenport Works facility in Iowa, which makes construction equipment, have also been cut. Deere said the layoffs were due to reduced demand for tractors amid a weakening farm economy and not related to plans to shift some production from the U.S. to Mexico.
Dive Insight:
Deere has now cut more than 2,000 jobs this year — including salaried positions — as declining grain prices pressure farmer financials and leave them less willing to buy new equipment.
The company’’s third quarter revenue was down 17% as sales of tractors and other equipment took a nosedive, according to its latest earnings report. In addition to layoffs over the past year, the company has signaled that it plans to move some production from the U.S. to Mexico in a move that’’s sparked broad pushback from politicians including former President Donald Trump.
In a statement to Agriculture Dive, Deere stressed that the latest layoffs are not associated with plans to move production, instead citing continued declines in crop prices.
“As we have repeatedly stated, layoffs this fiscal year are due to the weakening farm economy and a reduction in customer orders for our equipment,” a spokesperson said in a statement.
Rep. Eric Sorensen, a Democrat representing the Quad Cities area in Illinois, said in a statement that the layoffs underscore the need to pass a farm bill to help lift up farmers and create more demand for manufacturers like Deere.
“It is clear from today’s decision that now more than ever we need to pass a bipartisan Farm Bill,” said Sorensen, a member of the House Agriculture Committee. “Critical programs that impact the price of corn and soy are running out of money and need to be replenished and updated. This affects Deere & Company’s production and impacts workers as much as our family farmers.”
In August, following yet another round of job cuts in the Quad Cities area, Sorenson met with Deere in Moline to discuss the layoffs. The Illinois Democrat said that he received commitments from the company that the company does not plan to move its Moline headquarters to Mexico and that “no additional changes in workforce are expected” besides the previously announced layoffs.
“Deere & Company’s annual profits exceed $7 billion,” Sorenson said in a statement on Wednesday following news of the latest layoff. “C-suite salaries are in the tens of millions of dollars. They can afford to better take care of their workers in John Deere’s hometown.”
The Harvester Works factory in East Moline, Illinois, employs 1,880 workers, with the majority working production and maintenance jobs. The company said it has 625 employees at Deere’s Seeding and Cylinder operations in Illinois, while the Davenport factory in Iowa has 1,024 workers.