Dive Brief:
- Deere & Co. is laying off 119 workers at a plant in Ankeny, Iowa, as the farm and construction equipment giant continues to navigate sales and inventory challenges.
- The Moline, Illinois-based company recently notified employees at its Des Moines Works factory of upcoming layoffs, effective in three groups on March 31, April 7 and April 28, according to Iowa state WARN filings.
- The latest downsizing is driven by reduced demand for Deere’s sprayers, cotton pickers, grain drills and other products made at the factory, a spokesperson said in an email Wednesday. Today, Des Moines Works employs about 1,500 people.
Dive Insight:
Agricultural equipment makers have struggled to sell their machinery over the past year as weak farm incomes and high interest rates hamper borrowers from making big-ticket purchases.
The sales slowdown has forced Deere, CNH Industrial and others to reduce their manufacturing workforces to better align with demand. Just in Iowa, the John Deere tractor maker has laid off 1,866 people across its factories and offices since March 2024, according to the state’s WARN log.
“As we have repeatedly stated, these layoffs are due to the weakened farm economy and a reduction in customer orders for our equipment,” a spokesperson said in an email. Affected employees are eligible for severance packages depending on their years of service and can keep their healthcare benefits for up to six months.
Last summer, Deere’s Des Moines Works factory expanded its sprayer assembly by 138,000 square feet as part of a $40 million investment in the building and infrastructure. As the company looks to grow and invest in the future, declining sales have been a recent pain point.
First quarter sales totaled $6.8 billion, down 35% over last fiscal year. In addition to slow demand, proposed tariffs on metal and aluminum imports have muddied financial outlooks and expectations for the year.
“The situation is certainly fluid and we continue to monitor changes in policy as they occur,” SVP and CFO Josh Jepsen said in a recent earnings call. He added that China’s recently enacted tariffs on U.S. imports will have an “immaterial” impact on Deere’s business.
“Our primary focus remains on understanding how proposed tariffs may impact our customers’ operations as we recognize their need for free and fair trade in ag commodities,” Jepsen said.
