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John Deere announces mass layoffs in Midwest amid production shift to Mexico
John Deere, the world’s largest seller of tractors and harvestersannounced another wave of layoffs on Friday, telling about 610 production employees at factories in Illinois and Iowa that they will be out of a job until the end of the summer.
The company is laying off about 280 workers at a plant in East Moline, Illinois, while another 230 employees are being laid off at a plant in Davenport, Iowa. About 100 production employees at the company’s plant in Dubuque, Iowa, will also be affected. All layoffs will take effect Aug. 30, the company told Fox Business.
Layoffs are being made due to reduced demand for John Deere Products of these factories.
The company claims to have generated $10.166 billion in profits last year.
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“We can confirm that Deere leadership recently communicated that rising operating costs and declining market demand require company-wide changes in how work is done to achieve our goals and better position the company for the future,” a John Deere statement read.
Workers will receive Supplemental Unemployment Benefit (SUB), which will cover about 95% of their weekly take-home pay for up to 26 weeks, depending on their years of service. They are also receiving profit-sharing options and health benefits.
Deere, known for its iconic green and yellow colors and leaping deer logo, is one of the oldest companies in the United States, having been founded in 1837, nearly 25 years before the outbreak of the Civil War.
Earlier this month, Deere announced it will move manufacturing of skid steers and compact track loaders from its Dubuque plant to Mexico by the end of 2026.
A John Deere 9700 forage harvester at the World Agriculture Expo in Tulare, California, on February 13, 2024.
The company said the decision is due to the evolution of its business model, addressing rising manufacturing costs and improving operational efficiency.
“This includes optimizing our factories for future products, making our operations more efficient and taking advantage of locations across the U.S. and around the world with a growing workforce,” says a company statement.
In October, John Deere announced its first wave of 225 layoffs at its Harvester Works plant in East Moline. Another 34 production employees were laid off in May at its Moline Cylinder Works plant, while in March, company executives announced they would lay off 150 more workers at a plant in Ankeny, Iowa, where cotton pulverizers and pickers are made.
About 500 workers have been laid off at the Waterloo, Iowa, plant, according to WQAD.
The story continues
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A former John Deere employee at the Harvester Works plant in East Moline attributed the latest announcement to greed.
“It seems like we are hearing more layoffs every day, and it is causing uncertainty all around,” the worker, who wished to remain anonymous, told the Guardian. “The only reason Deere is doing this is greed.”
Deere & Co’s market capitalization stood at around $102.81 billion as of Friday night. In mid-May, the company said it had generated $27.42 billion in net sales and revenue in the first two quarters of the year. Its net income for the same period was $4.121 billion.
The company recently cut its annual profit forecast for the second time and projected steeper declines in sales of large farm equipment.
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Lower crop prices are leaving farm equipment sellers with a glut of unsold tractors and combines, prompting some to offer discounts and suspend new orders.
The Department of Agriculture also predicted that farm income would fall 25.5% to $116.1 billion this year, starting in 2023.
News of the layoffs arrives amid a report on Wednesday that John Deere CEO John May has put his 80-acre horse farm property up for sale. Its asking price has been set at $3.925 million, according to its listing.
Reuters contributed to this report.
Source of original article: John Deere announces mass layoffs in Midwest amid production shift to Mexico