AGCO Corp., the world’s No. 3 farm equipment maker, is facing fresh challenges in its push to expand in the U.S. as new tariffs raise costs on its largely Europe-based production, according to a report by The Wall Street Journal.
The Duluth, Georgia-based company imports about 35% of its North American sales from Europe, leaving it more exposed to U.S. tariffs than rivals Deere & Co. and CNH Industrial, the report said.
Chief Financial Officer Damon Audia told the Journal the company is weighing adjustments across its supply chain, including shifting some sourcing and pressing suppliers for greater efficiency. “All of us are looking at these costs trying to figure out how to keep it low for the farmers,” he said. “But ultimately, these are things that we’re going to have to try to pass through in some capacity over time.”
Analysts caution that tariff-driven price hikes could dampen AGCO’s U.S. ambitions. “This is a period of incredible uncertainty for AGCO and its customers,” Kristen Owen, managing director at Oppenheimer & Co., told the Journal. “AGCO, being the smaller player in the North American region, is not likely to be the first to lead with that price increase but could be fast followers.”
Despite headwinds, AGCO shares are up 26% in the past year, fueled by demand for precision agriculture and sustainable technologies. Still, U.S. sales fell 24% in 2024, with tariffs likely to make further growth more difficult.
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