A large manufacturer is moving production to a new plant in Mexico, which means hundreds of jobs are being cut in Illinois.
In preparation for a planned relocation of operations to Ramos, Mexico, John Deere, an Illinois-based corporation, has announced the layoff of 600 workers at three US facilities.
The layoffs will begin on August 30 and affect a total of around 310 workers at two sites in Davenport and Dubuque, Iowa, and 280 workers at a plant in East Moline, Illinois.
Roughly 4,175 people work in production and maintenance across all three plants.
The two Iowa plants make machinery for construction and forestry, whilst the Illinois plant makes combines and other harvesting tools.
This move comes after the farm equipment maker had laid off a number of workers in the previous year.
Falling agricultural revenue in the US has prompted Deere to rebrand as a software firm.
Reducing demand for the items produced at these sites is the reason behind these changes, the business said CNN in a statement on Friday.
“In order to ensure that Deere can keep up with future demand, we are actively working to decrease production and inventory.”
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The business, which had previously announced a net income of over $10.16 billion in 2023, has now shown revenue that is down year over year.
During a May earnings call, executives at Deere predicted that the company’s revenue for 2024 will be around $7 billion. They attributed their prediction to factors such as increased production costs, decreased shipment quantities, and customers’ heightened apprehension due to unpredictable weather.
In the second half of 2024, the company’s demand is expected to fall incrementally, according to Josh Beal, director of investor relations, on the May income call.
Taking proactive measures to reduce field stocks will result in a greater fall in production volumes than demand in the second half.
This is valid not only for our North American big tractors market, but also for our South American and European markets.
In our opinion, this strategy will put us in the greatest position to increase retail demand in the year 2025.
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