In a one-on-one phone interview with Bob Crain, Senior Vice President and General Manager for AGCO North America, he confirmed that AGCO Corporation will cease production of its orange line of AGCO brand tractors.
"Change is difficult. I recognize this is an emotional subject and change brings that out," Crain says. "At the end of the day, we [AGCO management] are extremely confident in these tough decisions, and that this is the right decision for the medium- and long-term."
The AGCO branded tractors will continue to be produced through 2010, with a final timeline expected before the end of the year and before production will have to switch to meet Tier 4 emissions standards. The company says it will focus its resources on engineering and marketing Challenger and Massey Ferguson branded products in North America.
Crain says he understands the emotional feedback from dealers and customers.
"I have first-hand experience in brands changing," he says. "My grandfather started one of the first Ford Tractor dealerships in Mississippi. But it's a fact that in the past 30 to 40 years, this industry has been all about change."
Established in 1990, AGCO Corporation has grown through a series of more than 24 acquisitions. Four years ago the company launched a "cornerstone" brand approach to consolidate brands under the AGCO, Challenger and Massey Ferguson names in North America. In the past year, AGCO said it will focus on four brands worldwide: Challenger, Fendt, Massey Ferguson and Valtra.
"This change will be the avenue for us to consolidate and focus our resources to give our customers and our dealers a better and more productive product," he says. "For us to be competitive and provide better products, it requires us to focus our resources. And just as important, we are spending more dollars on research and development than at any time in our history."
In February of 2009, the company launched completely new high horsepower tractors within the AGCO, Challenger and Massey Ferguson brands. More than likely, the DT Series Tractors will be last series launched bearing the AGCO brand name.
As AGCO tractors are phased out of production, customers will not see a disruption in parts availability. Many of the parts used on AGCO tractors were based on a common platform shared with other brands. Also, Crain says that today dealers supply parts dating back to the 1950s for most of the legacy brands within AGCO Corporation and that customer service will apply to the AGCO brand as well.
Those dealers who sell and service AGCO tractors will have the opportunity to transition into Massey Ferguson dealers (or in some cases Challenger dealers). In early December Crain will travel to five regional dealer meetings to speak with the AGCO dealer group in person and address their concerns. He says a specially chosen AGCO brand dealer advisory panel was very helpful in this process, and their feedback helped shape how AGCO will proceed with this change.
This announcement only affects the AGCO brand of tractors, and Crain notes Gleaner combines will be unaffected, and in fact more resources are being devoted to the line.
"We're investing significant dollars in the Gleaner line of transverse combines," he says. "And we'll have new product to bring advanced technology and productivity to those combines."
The implement lines of Hesston, Sunflower and White are also unaffected by this announcement. The Fendt and Valtra brands will continue to be available in North America as what Crain refers to as niche brands.