Deere’s Q3 Report Focuses on Cutting Costs

Deere said last week it plans to further cut production this fall to offset slumping sales of farm and construction machinery.

The manufacturer is trimming output and laying off workers at plants in Illinois and Iowa due to weak demand in North America and big overseas markets in Europe and South America.

Deere outlined its latest cost-cutting efforts as part of its third-quarter earnings report, which included news that farm equipment sales slipped 11 percent while profits rose 21 percent because of cuts.

The company has been throttling back on production to avoid swelling inventories of new machinery at its dealers. The outlook for its construction and forestry equipment also weakened.

Since 2014, Deere has put about 2,000 employees in its Midwestern factories on indefinite layoff. Its global workforce is now about 57,000 employees, down from about 67,000 in 2013.

The company said production hours at its East Moline, Ill., combine factory will decline 60 percent this quarter. It also plans to reduce output at its Waterloo, Iowa, tractor plant by 20 percent. Other news sources say the Davenport operation is also in the latest round of cuts.

Sources: Bloomberg, Radio Iowa