Illinois will bear the brunt of it with 425 layoffs in East Moline and 35 in Moline. East Moline, which employs 1,730, will begin layoffs on Oct. 20. Moline employs 710 and will begin its layoff process on Aug. 25. Total employment for the company is 35,000 in the U.S.
When Deere reduced its yearly earnings forecast and reported a 15 percent decrease in its fiscal third-quarter profit on weaker farm equipment sales, a scaling back of production became imminent. To help with this, Deere will also be implementing seasonal and inventory adjustment shutdowns and layoffs at selected factories. Locations experiencing extended shutdowns are East Moline, Ankeny and most of the John Deere Ottumwa Works plant in Ottumwa, Iowa.
Although the agricultural economy is still relatively healthy, demand for large farm equipment has decreased due to falling commodity prices. A 6 percent drop in the fiscal third quarter has been reported worldwide. The U.S. and Canada have experienced the largest decline.
Agricultural and farm machinery sales are expected to drop 10 percent this year in the U.S. and Canada. Asia is predicted to stay the same, but the European Union is expected to drop 5 percent. South America is looking at a 15 percent decline in its tractor and combine sales. Consequently, Deere has adjusted its previous outlook. The worldwide sales of their agricultural and turf equipment are now expected to drop 10 percent instead of seven. FG
—Summarized by Progressive Forage Grower staff from cited sources
