Deere & Co.'s (NYSE:DE) joint venture in India with partner Ashok Leyland Ltd. is up and running. The venture is called Ashok Leyland
John Deere Construction Equipment Co. Pte. Ltd. and will manufacture construction equipment for the Indian market and for export. Ashok is the second-largest maker of commercial vehicles in India. Financial terms of the venture, first announced in September 2008, were not disclosed.
The venture could help boost sales of Deere construction equipment, which have suffered during the housing downturn. As this
Manufacturing.net report indicates, Deere has gotten a lift from its farm equipment sales, which have remained strong. But even there, obstacles remain. With credit tight and crop prices dropping, farmers have had difficult securing loans for new equipment.
To manage through the downturn, Deere has been cutting staff. The company announced in June that
800 workers had accepted voluntary separation agreements, netting Deere first-year savings of $75 million after a pretax expense of about $100 million. Deere also recently laid off about 500 workers at one of its Illinois factories.
Still, the downsizing doesn't mean Deere isn't pursuing growth, particularly in emerging markets. The India JV is one example. And the Chicago Tribune quoted chief operating officer Samuel Allen, who takes over as chief executive on Aug. 1, as saying plans are underway to expand Deere's presence in the agricultural equipment space in Russia. - Suzanne Stevens
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