View Full Version : Happening to Deere, what about the others?

06-29-2001, 04:59 AM
Deere to Eliminate 1,250 U.S. Salaried Positions
Moline, Illinois: Deere & Co. plans to eliminate 1,250 jobs,
or 8 percent of its U.S. salaried workforce, as demand for construction
and lawn equipment dwindles.
The company plans to take a $140 million charge in its fourth
quarter ending in October to cover severance and other costs. It's
offering early retirement to 2,500 workers, with the goal that
half will accept. Deere, which employs 43,700, expects the action
to save $90 million a year.
Deere's customers are buying fewer excavators and loaders as
the U.S. economy's expansion slows. The company has blamed weather
for hurting sales of lawn-care equipment in two of the past three
quarters. Deere, the biggest maker of tractors, has tried to
counter slower sales in the past several years by adding products,
upgrading order processes and improving manufacturing.
``What you're seeing is a reflection of how difficult
economic conditions are for the manufacturing economy,'' said John
Inch, an analyst at Bear Stearns, which rates Deere ``neutral.''
Sales of construction and lawn equipment has ``only just started
to come under pressure,'' he said.

Richard Martin
06-29-2001, 06:14 AM
That is what Deere says is happening. The fact of the matter is how many heavy duty pieces of equiptment can you sell before the market becomes saturated with new machines. It's not a function of a slowing economy but of everybody who wants one has one. Selling large equiptment is cyclic. It comes and goes.

It basically the same thing with lawn and garden equiptment. Deere and Cub Cadet have been pushing their machines for so long at sale prices (how many TV ads do you see a day for one or the other?) that everybody has one. Deere is blaming it on the weather. What in the Sam Hill are they talking about? Every respectable LCO is reporting record sales due to increased customers and weather that has been cooperating. Sure, the year before last there was a drought on the East Coast but last year and this year so far have been great weatherwise.

Vandora Lawn & Landscape
06-29-2001, 08:45 AM
Maybe its because very few people use deere commercial lawn equipment?

Eric ELM
06-29-2001, 08:59 AM
John Deere messed up when they didn't make a ZTR sooner and make it themselves. I have not seen a JD ZTR except at a dealer and this used to be JD country around here. I used to mow with them too several years ago. :o

Kent Lawns
06-29-2001, 09:09 AM
I agree.

Deere's effort to buy other manufacturers (i.e. Dane) is an effort to gain market share, but (my guess) to aquire engineers and thinkers to design equipment the pro's will get exited about.

Short of a 7 gauge stamped deck, I don't see any piece of Deere lawn equipment that offers more than the competition does.

The econominic slowdown hasn't reached Caterpiller or Toro/Exmark yet.

06-29-2001, 10:27 AM
On a side note:

Deere still IMPORTS (into the US) tractors with there name on them
Deere, employs thousands of people in Mexico at sub standard wages, are any of these employees being laid off ?

Just something to think about........

06-29-2001, 11:18 AM
Can't say for sure, but I can say I am a Branch Manager for a company that sells electric motors, controls and drives. The economy in my area is really bad. Mfg. plants in the area are laying off and several have shut down completely in the last few months. The ones that are staying open are spending as little as possible and only for absolutely necessary repairs. Almost no new projects or in-house expansions, etc. I hope it turns around soon, but as stated above, the green industry seems to be doing ok, at least for the smaller operators.

Hoss, have you heard about one of the big operaters in our area scaling way back, laying off workers and selling equipment? That is the first big hit on an LCO in the area that I have heard of.

06-29-2001, 01:32 PM
they may be lieing to america to move things to mexico.

06-30-2001, 04:03 PM
Eric is right on. My past employer ran 430 & 455 JD garden tractors for years. We demoed an Exmark Lazer in 1996 and saw such a jump in productivity that we traded off those Deere's on Lazers. Deere missed the boat big time!! They should have designed & built their own ZTR 10 years ago. With some forsight they may of kept a bigger share of the commercial market & wouldn't have the economic problems now.

06-30-2001, 05:35 PM
The problem with Deere's construction equipment is just as Richard Martin said, they produce way to many pieces of equipment. They blow a ton of money on research and devolopment. Every year, or almost every year, they have a new series out in some line of equipment. This year it is their new G-series backhoes, last year was the H-series dozers, a couple years ago the 200 series skid steers, and so on and so forth. They push their equipment, which good equipment it is, but there is just way too much out there. All the contractors in my town have already bought new equipment and once you have new stuff, it's gonna last you a few years. They've saturated their market. It's going to be slow, and in a couple of years, it might pick up for them. I predict that new excavators will be coming out. With Cat's new C-series excavators already out, Deere is under pressure. I guess we'll see what the response is there.

As for lawn equipment. Yeah, their stuff is good, well, their homeowner stuff is good. I've heard pretty good things about their walkbehinds, but I'm not going to judge because I've never used one, but their ZTR's? A whole other story. You'd think that with their technology, they would have designed one sooner, now they're paying for it. But, with the purchase of Dane, they might gain an advantage, but with their screw-ups in the past, who would ever want to try one of their ZTR's again?

07-01-2001, 12:09 AM
Your last comment is right on the money. I just dumped a 1 year old JD ZTR that was the "mower from -ell" .It will be a long time before I would ever think about buying another JD ZTR.:angry:

07-01-2001, 11:33 PM
The city's around here always used to run JD equipment now you see Ford's and other commercial equipment. I think they are loosing market share quickly. JD are at the top of the price list, lots of homeowners are going the cheaper route now. The sabre line was supposed to help but most of the JD dealers here are saying they are not "real" Jd's so people are buying other MTD brands instead.

07-01-2001, 11:44 PM
I have a brother-in-law who owns four JD Dealerships down in Tx. When we first entered the biz he offered to front us the new equipment so that we could improve production.

To this date I have yet to take him up on his offer. Unfortunately JD cannot compete with the worst of dealers in our area. Sorry guys @ JD.:(


Eng Mwr Guy
07-02-2001, 06:36 PM
Deere still IMPORTS (into the US) tractors with there name on them
also, Deere, employs thousands of people in Mexico at sub standard wages, are any of these employees being laid off ?

Just something to think about........

Well Put Consultant

And the numbers will continue to grow. We are in dire times for American workers. It no longer pays to build things here. Mexico...shoot, try China for pennies a day. And their quality is going up to the point it is a serious threat.

Welcome to globalization. Welcome to NAFTA.

As long as we continue to allow our purchasing decisions to only be motivated by a few percent on the sticker price we will all suffer the short term consequences of redeployment of the workforce.

Just so you know it is white collar too engineering jobs are being done by imported engineers or the work is being exported to India and now even Mexico.

Just my perspective.