With the 75,000-foot expansion to its Jackson, Minn., manufacturing plant, AGCO is moving production of its Challenger and Massey Ferguson high horsepower row-crop tractors from France to North America. This fulfills part of the company’s plan to completely localize tractor production. In addition to being able to promote its “Made in America” program, “We want to become independent from exchange rates, so the more American parts we can put in the better,” said Martin Richenhagen, AGCO’s chairman and CEO.
Their next step, he says, is to begin building smaller tractors, up to 135 horsepower (100 kW), in North America. “This is a project that is in the pipeline already and the tractor will be also assembled here in America.”
In the long term, Richenhagen says, the idea is to become completely independent from other countries here in the U.S. “That means we would like to have everything we sell in America be produced in America, and we are getting there. This is an important first step into that direction.”
At the same time, Richenhagen says AGCO still wants to increase its exports from America. “We do quite a lot of exports from our Hesston factory, mainly the bailers are very successful, but the demand to export our sprayers which is also growing.”
In addition to neutralizing the effect of exchange rates, AGCO estimates they’ll be saving 30-45 days shipping time by producing tractors at the Jackson plant..