Tariff Pause Puts Shortliners in the Crossfire
As President Trump hits pause on new tariffs for most countries — with China remaining the exception — both global farm equipment giants and North American shortliners are navigating uncertainty. The existing 10% tariff on imports holds steady, but future shifts remain on the table.
CNH Industrial (Case IH, New Holland) and AGCO (Fendt, Massey Ferguson) temporarily halted U.S. imports from European plants to assess the tariff impact. Both have since resumed limited shipments. John Deere, which manufactures 84% of its equipment in North America, hasn’t made changes but may face international headwinds due to reciprocal tariffs.
For shortline manufacturers, the picture is just as complex. Many rely on imported components or export specialized equipment globally — making them vulnerable to delays, rising input costs, and shifting demand. Even without headline-grabbing announcements, many in our space are adjusting production, pricing, and supply chain strategies behind the scenes. Small-to-medium sized manufacturers may be particularly at risk, with their thinner margins and more limited access to alternate markets. Shortliners often have to be nimble, but rising tariffs can significantly disrupt this agility.
While major manufacturers have the financial backing to weather these tariff changes, shortline manufacturers may struggle with increased overhead costs and squeezed profit margins. Some have expressed concerns about the long-term sustainability of absorbing these added costs without passing them along to farmers — or if market conditions make it difficult to do so.
In response, some shortliners are exploring new business strategies to mitigate risks, including diversifying suppliers or relocating production to regions with more favorable tariff conditions. Others are forming alliances to pool resources and negotiate better rates for imported materials, aiming to maintain competitive pricing.
Claas, which has significant EU operations but builds combines in Nebraska, will continue delivering presold U.S. units while reducing stock-machine production. The company is considering expanded production in North America to avoid future trade disruptions — a strategy some shortliners are exploring as well.
Johan “Kip” Eideberg of the Association of Equipment Manufacturers said the group supports the President’s goal to strengthen U.S. manufacturing but warned about the risks of disrupting a global supply chain.
“We want to build more equipment here in America,” Eideberg said. “But we also depend on critical inputs from around the world. If those get more expensive, it affects the entire chain — including farmers and rural manufacturers.”
As the 90-day tariff pause plays out, shortline manufacturers — like their larger counterparts — are watching closely, adapting fast, and staying focused on the farmers they serve.
Source:
Adapted from reporting by Matthew J. Grassi, with added context for shortline manufacturers.