Deere Will Beef Up Factory Capacity for Large Tractors

August 27, 2008 07:00 PM
 
An AgWeb.com Farm Equipment Special

To keep up with rising worldwide demand for their large, high-horsepower tractors, Deere & Company has announced a broad expansion plan to expand manufacturing capacity—this move is addition to tractor factory expansion announced in February.

Deere said the new initiative will invest approximately $97 million in areas that are core to the business and offer a competitive advantage, such as the Waterloo foundry, engine, and drive train operations.

An addition of an estimated 103,000 square feet will be added to the drive train operation in Waterloo and part of the total investment will be spent on improvements at a John Deere plant in Coffeyville, Kansas, where Deere builds transmissions and other drive train components.

The latest project announcement is in addition to the investment of approximately $90 million that Deere had announced in February to increase manufacturing capacity at the Waterloo Operations. In combination, the projects will increase John Deere's manufacturing capacity to build high horsepower tractors in Waterloo by about 40 percent and increase capacity for other tractor components and service parts. The company said both projects are expected to be complete by early 2010.

According to the company's announcement, tractors built in Waterloo are exported to more than 130 countries.

Putting More Money Into Brazilian Operations, Too.

Deere & Company further announced it will invest approximately $80 million in its agricultural manufacturing and parts distribution operations in Brazil to increase manufacturing capacity for both tractors and combines as well as to improve service to customers.

The company said the investments were being made in its combine and planter factory in Horizontina, its tractor factory in Montenegro, and for the development of a new parts distribution center in Campinas.

The investments will allow Deere to increase manufacturing capacity by approximately 35 percent in its Horizontina and Montenegro factories. The funds will improve manufacturing flexibility, optimize the use of assets and improve aspects of the factory layout and assembly lines. Investments will also assist suppliers to improve capacity and logistics.

The projects also include creation of a parts distribution center to improve service to the company's growing dealership network across Brazil and other portions of South America.


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