“CLAAS managed to achieve growth despite the supply-side bottlenecks and the pandemic. We even registered a double-digit rise in revenue and a significant improvement in profitability across all world regions,”

said Thomas Böck, chair of the CLAAS Group Executive Board.

Last year’s growth in North America and Eastern Europe has been joined by the core markets in Western and Central Europe, including Germany and France, which are important for Claas. The United Kingdom also experienced major growth, despite the significant uncertainty surrounding Brexit.

Spending on research and development at a record level

Expenditure on research and development set a new record with €262 million (previous year: €237 million). Investments in innovative electronic architectures and the digitization of agricultural processes remained important focus areas.

Investments in fixed assets totaling €138 million (previous year: €131 million) continued at a high level. In Le Mans, the Future Factory for tractors was reopened in May following an extensive renovation.  A modernization project of even larger proportions at the combined harvester production facilities in Harsewinkel, Germany, was also finished. Over 15,000 m² of production space was completely refurbished in just five months. State-of-the-art AGV transport systems are now used in the production areas of both factories, increasing both flexibility and efficiency.

Successful product campaign With

With innovative products and a strong sales team, Claas was able to acquire new customers and convince existing customers to stay with the company. Launched in 2019, the product campaign for harvesting technology continued with the new TRION combine series introduction throughout Europe and many other regions. The introduction adds a number of new models to the mid-range segment that is unparalleled in this combined harvester class.

There have also been significant developments in the tractor segment, where a number of new fuel-saving and performance-enhancing features were introduced. There was also a wealth of innovation in the forage harvesting segment, which included an extensive technical update for the QUADRANT large square baler.

The rise in the global workforce

The number of employees around the world rose over the course of the year and was 11,957 at the end of the fiscal year (previous year: 11,395). In Germany, the number rose by 3.5 percent to 5,790 (previous year: 5,596), and by 4.3 percent to 2,377 in France (previous year: 2,279). Group-wide, the number of trainees also increased to 775 (previous year: 714), of whom 473 were based in Germany (previous year: 430).

Outlook

The supply situation and price development in the procurement markets present a greater risk compared to last year. Overall, the company anticipates stable demand for agricultural machinery in the most important sales regions during the 2022 fiscal year. Despite these uncertainties, Claas expects a rise in revenue and a slightly lower result in a year-on-year comparison.

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U.S. total farm tractor sales climbed a healthy 8.7 percent in November compared to 2020, while U.S. self-propelled combine sales saw a gain of 37.8 percent, the fourth month in a row of growth near or above 20 percent for harvesters. All segments except articulated 4WD units grew in the month, led by the 100+hp segment, up 30.9 percent. Articulated 4WD units fell 23 percent on the month but remain more than 17 percent positive year-to-date. Year-to-date farm tractor sales are up 11.3 percent and combine growth climbed to 25 percent.

For Canada, November was a mixed bag, with tractors climbing 1.3 percent in aggregate, while harvesters fell 56.8 percent, bringing combined tractor and combine sales down 0.7 percent, or 18 total units. Segment-by-segment, sales in Canada were like the U.S., with articulated 4WD sales falling 52.8 percent, while 100+hp 2WD units led gains at 20.2 percent. The only segment difference was sub-40hp units which fell 2.5 percent in Canada while growing 6.8 percent in the U.S. Still, both tractors and combines remain above 20 percent growth year-to-date in Canada, with tractors up 20.5 percent, and combines up 28.1 percent.

“Both tractors and combines continue to see year-to-date growth in the double-digits demonstrating that farmer demand and optimism remains strong. While supply chain issues are still causing some bumps, our members continue to do all they can to deliver the parts and products to the market,”

said Curt Blades, senior vice president, industry sectors & product leadership at the Association of Equipment Manufacturers.

The full reports can be found in the Market Data section of the AEM website under Ag Tractor and Combine Reports.

Source: AEM

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Facing the multiple requirements of agricultural tires, the range includes different tire sizes with tire widths up to 800 mm, rim diameters of 46”, and tire diameters of up to 2.05 m. Thus, John Deere is expanding its existing Continental tire selection for mid tractors. Continental has been supplying John Deere with the Tractor70 and Tractor85 tires since 2019. Now, customers can specify all John Deere 6M and 6R series models with all Continental tires approved ex-works.

TractorMaster and VF TractorMaster: flexible use on field and road

Both tire models are characterized by their particular robustness, durability, and high mileage. The radial tires have a five percent higher lug surface area than comparable agricultural tires due to the special design and application of the d.fine lug technology developed by Continental. This ensures longer mileage. The tire’s material and the so-called n.flex technology ensure its particularly high stability of shape and impact.

The carcass material made of stretchable nylon is flexible enough to withstand an impact – without losing its original shape. Furthermore, the flexible material allows the tire to adapt particularly well to uneven ground. Thanks to this flexibility, the tire quickly returns to its original shape.

“With the TractorMaster, John Deere is expanding its tire portfolio with a test winner in the agricultural tire segment, which stands for efficiency and cost-effectiveness,”

says Jens Mund, Key Account Manager for agricultural tire original equipment at Continental Commercial Specialty Tires.

In 2019, the German Agricultural Society (DLG) certified the TractorMaster premium quality and Continental tire competed against other European premium tire manufacturers in the DLG test.

Both product lines are manufactured at the state-of-the-art Continental plant in Lousado, Portugal.

The partnership underlines Continental’s Agricultural Growth Strategy

John Deere has been offering its customers Continental agricultural tires since 2019. Jens Mund continuous:

“We are delighted that John Deere is expanding its tire range with further tires from us. This underscores our growth ambitions in the agricultural sector.”

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“We build the cleanest and most efficient engines for our customers. The sharp rise in unit sales shows that the market has confidence in our innovative drive technologies. As we move toward green off-highway drive solutions, we are stepping up our focus on hydrogen, electric, and e-fuels. This is the only way that we can achieve the Paris climate targets,”

says DEUTZ CEO Dr. Frank Hiller.

As well as a healthy operating performance, DEUTZ reached further strategic milestones. In August, the Company unveiled its first market-ready hydrogen engine. DEUTZ plans to go into full production with the TCG 7.8 H2 in 2024. The first pilot project gets underway with utility company RheinEnergie at the start of 2022 and will involve using the TCG 7.8 H2 in combination with a generator to produce electricity.

“What we are achieving here on a relatively small scale is delivering insights into the decentralized, sustainable, and greenhouse-gas-free supply of energy in urban centers,”

explains Hiller.

DEUTZ had already signed a cooperation agreement with the German Aerospace Center (DLR) regarding a joint project focused on making construction sites more environmentally friendly. The aim of the project is to develop solutions for running construction-site vehicles and agricultural machinery on hydrogen. DEUTZ is also improving the environmental footprint of its engines for the EU Stage V emissions standard. For example, it approved its entire TCD engine portfolio for use with paraffinic diesel fuels at the end of August.

Double-digit percentage increases in new orders, unit sales, and revenue

New orders received by DEUTZ amounted to €1,514.0 million in the first three quarters of 2021, an increase of 62.2 percent compared with the prior-year period, which had been heavily affected by a coronavirus. This growth can be explained by the fact that customers across all application segments and regions continued to be very willing to invest. The exceptionally strong rise was also attributable to the one-off effects of spending brought forward in June and September, which amounted to more than €100 million. This situation came about mainly because of customer orders being brought forward in response to longer lead times resulting from global material shortages and logistics bottlenecks and also in view of price adjustments.

As of September 30, 2021, orders on hand totaled €616.4 million, which was up by 146.2 percent year on year.

With a total of 145,359 engines sold, the DEUTZ Group registered an increase in unit sales of 33.9 percent in the reporting period. The number of DEUTZ engines sold rose by 37.6 percent to 116,273. The DEUTZ subsidiary Torqeedo sold 29,086 electric boat drives, which was 20.9 percent more than in the first three quarters of 2020. Almost all application segments saw big increases in unit sales. Only Stationary Equipment fell short of the level in the prior-year period due to a decrease in unit sales of gensets. The EMEA region, which is currently DEUTZ’s largest sales market, saw the sharpest rise in absolute terms. Unit sales in this region climbed by 35.2 percent.

Reflecting the growth in unit sales, DEUTZ generated consolidated revenue of €1,173.4 million in the period under review. All application segments contributed to this year-on-year growth of 26.4 percent. The lower rise in revenue, relative to the rise in unit sales, was mainly the result of the disproportionately sharp increase in demand for engines with a capacity of fewer than 4 liters. Service revenue swelled by 16.2 percent to €298.4 million, primarily due to the substantial growth of the business from parts sales. This means that the revenue target of around €400 million for the service business in 2021 is in reach.

All regions contributed to the increase in revenue with double-digit percentage growth rates. The German sales market saw a particularly sharp rise of 32.4 percent. In China, the most important sales market for the regional growth strategy, DEUTZ advanced its revenue by 32.8 percent compared with the prior-year period to reach €116.9 million.

Further rise in profitability; efficiency program is paying off

EBIT before exceptional items (operating profit/loss) improved markedly from a loss of €65.6 million in the prior-year period to a profit of €30.9 million in the first three quarters of 2021. This improvement was mainly attributable to the growth in the volume of business and the associated economies of scale. Earnings were further boosted by the increasingly noticeable effect of cost savings resulting from the restructuring process. Similarly, the EBIT margin before exceptional items made a strong year-on-year improvement from minus 7.1 percent to plus 2.6 percent.

EBIT for the period under review stood at €27.8 million (Q1–Q3 2020: loss of €103.4 million). This figure takes account of exceptional items amounting to an expense of €3.1 million that related to the efficiency program initiated at the start of 2020. The EBIT margin came to 2.4 percent (Q1–Q3 2020: minus 11.1 percent).

The increase in operating profit meant that the Company generated a net income of €23.7 million, compared with a net loss of €104.5 million in the prior-year period. As a result, earnings per share increased from minus €0.86 to plus €0.20.
Net income before exceptional items stood at €26.8 million in the reporting period; earnings per share before exceptional items came to €0.22.

Positive free cash flow and a comfortable financial position

Compared with the prior-year period, when cash flow had been weakened by the pandemic, cash flow from operating activities improved from a net outflow of €19.4 million to a net inflow of €67.9 million. This was predominantly due to the improvement in operating profit combined with more rigorous management of working capital across the Group, especially with regard to receivables and liabilities. As a result of the improvement in cash flow from operating activities and the reduction in investing activities, free cash flow was up by €94.0 million years on year to €15.2 million.

Reflecting these changes in cash flow, net financial debt was slightly lower than at the end of 2020. It amounted to €83.1 million as of September 30, 2021 (December 31, 2020: €83.8 million).

“Our efficiency program and the cost savings achieved are increasingly paying off. This can be seen from our earnings performance and improvement in cash flow,”

says DEUTZ CFO Dr. Sebastian C. Schulte, commenting on the DEUTZ Group’s financial position.

At the beginning of September, in light of its improved business situation, DEUTZ ended the €150 million credit line that had been granted to it with the assistance of Germany’s KfW development bank. The term of this COVID-19 tranche had been due to finish in November 2021. In addition to the existing syndicated loan of €160 million with a term until June 2024, DEUTZ has also secured bilateral credit lines totaling €75 million from three banks for a duration of 18 months.

“We have unused credit lines of €200 million at our disposal. This gives us sufficient financial headroom to be able to restructure the funding of our current and future growth projects and put it on a secure long-term footing,”

adds Schulte.

The Company’s equity ratio remains at a comfortable level at 45.0 percent.

Confirmation of raised full-year guidance for 2021

It can be assumed that global problems with the supply of input materials will continue to weigh on business performance and that supply issues for certain components will persist. Nevertheless, DEUTZ confirms its full-year guidance, which it raised in September, in view of its healthy business performance in the reporting period and the sustained upward trajectory of the industries in which the Company’s customers operate. It now expects unit sales of 155,000 to 170,000 DEUTZ engines in 2021, which should result in an increase in revenue to between €1.6 billion and €1.7 billion.

Service revenue is forecast to account for around €400 million of the total revenue figure. The anticipated increase in unit sales and revenue and the realization of further potential cost savings indicate that the EBIT margin before exceptional items is likely to be in a range of 2.0 percent to 3.0 percent. This is based on the assumption that the ongoing difficulties with the supply of components will not worsen significantly in the coming weeks. Reflecting the improved operating performance, DEUTZ is aiming for free cash flow to be neutral.

DEUTZ Group: an overview of key figures

Source: Deutz

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Ohio Machinery Co. entered the ag industry in 2003, doing business as Ohio Cat, and established its agriculture equipment division in 2008. Over the past 18 years, Ohio Ag Equipment has continued to grow within the ag industry and establish itself as a trusted and knowledgeable equipment dealer in Ohio. The rebranding illustrates this evolution.

“We have grown our business and footprint in Ohio over the last several years. Our brand relaunch represents the natural evolution of that transformation. Today, Ohio Ag Equipment offers seven full-service, ag dedicated locations across Ohio. It’s imperative for our brand to reflect and promote our company as it is today and the tremendous value we offer,”

said Mike Mampieri, Ohio Ag Equipment’s General Manager.

Mampieri continues,

“The new logo, website, and tagline reflect a new era for Ohio Ag Equipment, one that better represents our core values, what we do, and how we operate. While reluctant to depart from the recognizable black and yellow that saw us through from 2003, we feel it is time to modernize our look, symbolizing our move toward a stronger, stand-alone identity.”

Source: Ohio Ag Equipment

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ARA’s comments focused on the areas that have been identified by its members as priority issues, which include the following:

• Infrastructure: Investment in rural roads and bridges, railroads, ports and inland waterways, and rural broadband are critical to keeping the entire food system moving.
• Crop input production and regulation: ARA has always strongly supported a science- and risk-based regulatory system which fosters innovation, values the environmental benefits that using biotechnology enables agriculture to achieve, and recognizes the long and safe track record of plant and animal breeding along with the overwhelming evidence of the safe use of genetically engineered plants and animals. By protecting existing and emergent technologies that support production, American farmers and ranchers become more sustainable and strengthen the food supply long-term.
• Energy: ARA supports federal policies that increase domestic energy production resulting in reduced production costs for crop input materials manufactured in the United States.
• Labor: ARA favors reforms to the H-2A guest worker visa program to be more inclusive and less complicated for the employer. Additionally, ARA supports reforms to the Farm-Related Restricted Commercial Driver’s License (CDL) program, more commonly referred to as the Seasonal Ag CDL program.
• Pro-growth economic policies: ARA supports policies that will aid in its members finding a more business-friendly marketplace in which to operate. There are several barriers to entry within the American tax code that could be amended to protect ag retailers’ freedom and license to operate. These pro-growth policies will also positively impact the nation’s food supply chain and its resiliency.
• Food equity: Maintaining the ability to grow and produce food is at the heart of the American food system. This effort is led by America’s agricultural retailers working with their farm and ranch customers. Every item that consumers eat in the United States and around the world starts out being grown or produced before it eventually makes its way to the consumer’s plate.

“There is no easy fix to the supply chain disruptions facing the agriculture industry and any solutions need a multi-pronged approach including, but not limited to, issues of infrastructure, crop input production and regulation, energy, labor, pro-growth economic policies, and food equity,”

said ARA Director of Public Policy Hunter Carpenter.

“Any long-term solutions to addressing the challenges we face in supply chain disruptions will only be found through the continued partnership between the agricultural retailer, their farmer customers, and regulating authorities.”

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Dr. Frank Hiller, Chairman of the Board of Management of Deutz AG:

“After a challenging year dominated by the coronavirus pandemic, we are optimistic about 2021. The preliminary results for the first quarter show a return to an upward trajectory. We have made a successful start to the year, with new orders rising by a third compared with the prior-year period and a significant improvement in profitability. We expect that our customers will remain keen to invest going forward.”

Against this backdrop, Deutz has raised its guidance for 2021. The Company anticipates revenue of €1.5 billion to €1.6 billion (previously: at least €1.4 billion) and an EBIT margin before exceptional items of between 1.0 percent and 2.0 percent (previously: at least break-even level).

In 2020, Deutz laid the foundations that will enable it to maintain its competitiveness and generate further growth over the long term. The key building blocks of the corporate strategy are a technology-neutral approach to the development of the drive portfolio (focusing on electrification and the use of alternative drive solutions), the expansion and digitalization of the high-margin service business, regional growth initiatives (primarily in the Chinese market), strategic partnerships with industry leaders such as John Deere Power Systems, and the efficiency program that is now underway.

The shareholders of Deutz AG voted in favor of all the agenda items at the virtual Annual General Meeting. The majority of the shareholders registered for the Annual General Meeting agreed to motions such as the proposal to approve the new Board of Management remuneration system.

In addition, Dr. Ing. Rudolf Maier, independent management consultant and former member of the divisional board of Bosch Diesel Systems, was elected as a shareholder representative on the Supervisory Board with effect from April 29, 2021. He had already been appointed by the courts to replace Dr. Ulrich Dohle, who had stepped down from the Supervisory Board on October 7, 2020, due to ill health.

“We are delighted that Rudolf Maier, an expert with a long track record in commercial vehicle development and products, has joined the Deutz AG Supervisory Board,”

said Dr. Frank Hiller.

Upcoming financial dates

May 6, 2021: Quarterly statement for the first quarter of 2021

August 12, 2021: Interim report for the first half of 2021

November 10, 2021: Quarterly statement for the first to the third quarter of 2021

March 17, 2022: 2021 annual report

April 28, 2022: Annual General Meeting

Source: Deutz

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Engcon NA business continues to grow despite the ongoing pandemic contributing to one of the toughest quarters in modern history. Interest in Engcon’s products remains very strong and indications are that sales will continue to increase in 2020.

“Engcon North America is in an expansive phase right now. We increased significantly in 2019 and had a very successful participation at Conexpo, one of the world’s largest trade shows. There, visitors got to test drive excavators equipped with Engcon’s tiltrotator and our other smart products. Interest in our products has increased since then, which means that we are now shifting to a higher gear with a new head of Engcon NA and new premises,”

says Anders Smith, Regional Director at Engcon.

The new head of Engcon North America

Morten Solgaard the new Managing Director of Engcon NA, most recently worked at Scania – a Swedish OEM for heavy trucks and buses – where he held various roles for the past 22 years, primarily in the sales and service field. He is also familiar with the industry and the high demands placed on suppliers.

The expectations of Engcon NA’s new manager are that he, with his experience and leadership skills, will be an important cog in the wheel of continued expansion in the North American markets.

“We have moved both offices and the central warehouse to a new facility in Hamden, Connecticut to handle our continued growth. The new premises are approximately 1,200 m² (13,000 ft²), three times as large as the previous one. But above all, the new building is adapted for our business,”

says Anders Smith.

Increased demand

Despite the pandemic, orders to Engcon North America increased by 50 percent from January to June 2020 compared with the same period last year. Sales have increased to both small and large companies and to all sizes of excavators. Unlike last year when they were mainly sold to small machines, this year the demand has been for the entire range of excavators from 1.5–33 tonnes.

“There is an enormous potential to streamline excavation here in North America. All players will benefit if the excavators become more efficient, more environmentally friendly, and safer. Fitted with Engcon’s tiltrotator and smart accessories our goal is to “Change the world of digging” and hope that as many people as possible join us,”

Anders Smith concludes.

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Since Magna Tyres launched its office in the US, the demand for Magna tires is rising rapidly. Due to the forecasted market potential and huge demand for the Magna brand, the US team will grow even more.

“We have shown what we are capable of as the largest 2nd tier tire manufacturer, resulting in a continuous growing customer base and a number of valuable partnerships. This year we will continue to roll out our successful strategy and strengthen the Magna footprint across the North American continent”

according Magna Tyres Group.

Source: Magna Tyre Group

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Mordor Intelligence released an overview of orchard tractor market growth, trends, and forecasts for 2020-2025, segmenting the market by horsepower and geographical location.

Market Overview

Scope of the Report

For the purpose of this report, the tractors used in agricultural operations, especially Less than 20 HP, 30 HP, and 30-40 HP tractors are considered. Tractors used for orchards and garden purposes are included in the study.

• By Horsepower
  • Less than 20 HP
  • 20-30 HP
  • 30-40 HP
• By Geography
  • North America
    • United States
    • Canada
    • Mexico
    • Rest of North America
  • Europe
    • Germany
    • United Kingdom
    • France
    • Rest of Europe
  • Asia Pacific
    • China
    • Japan
    • India
    • Australia
    • Rest of Asia-Pacific
  • South America
    • Brazil
    • Argentina
    • Rest of South America
  • Africa
    • South Africa
    • Rest of Africa

Key Market Trends

Rise in Technological Advancements is driving the market growth

North America is Dominating the Orchard tractors market

The continuous rise in farm labor wages due to labor shortage, especially in fruits and vegetable plantation has had a positive impact on the demand for tractors in this region, as farmers are increasingly adopting agricultural mechanization including tractors as a substitute for manual labor. The wave of modern technology has already been witnessed in orchard tractors with the application of Artificial Intelligence-based tools for data transmission, for precise decision-making processes in cultivation. The rise in technological advancements in orchard tractors coupled with the decline in farm labor shrinkage is driving the demand for orchard and garden tractors sales and is expected to grow further during the forecast period.

Competitive Landscape

The global Garden and Orchard type tractors machinery market is fragmented with the presence of many of regional players. Deere & Company, CNH Industrial N.V., Mahindra & Mahindra Ltd and Tractor, and Farm Equipment Limited are some of the global players who are operating in this market. Product Innovation and expansion are the key strategies adopted by these players to strengthen their presence in the global garden and orchard type tractor machinery market.

Major Players

1. Deere & Company
2. Kubota Group
3. CNH Industrial N.V.
4. Mahindra & Mahindra Ltd.
5. Tractor and Farm Equipment Limited

Source: Mordor Intelligence

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