For the quarter, net income was $617 million vs. $592 million for the same period in 2022, a 4% year-over-year increase. Consolidated revenue was $6.79 billion in the quarter (down 2% compared to Q4 2022) and Net sales of Industrial Activities were $6.02 billion (down 5% compared to Q4 2022).

Ag Sales Decline

Agriculture segment net sales for the full year were $18.12 billion, up 1% year-over-year. For the quarter, agriculture net sales were down 8% for the quarter to $4.95 billion, primarily due to lower industry volume, dealer inventory management and unfavorable mix, CNH said.

In a note to investors, Stanley Elliott, managing director, Stifel, wrote, “For 2024, CNHI expects industry sales to decline 10-15% in ag and construction to decline 5-10%. CNHI’s segment sales are expected to outperform industry declines and margins are expected to outperform past cycles. 

Source:

Net sales of Industrial Activities were $5.33 billion, a decrease of 1% when compared to the corresponding period from the previous year. This decline is mainly due to lower industry demand in Agriculture, especially in South America and in EMEA for combines. Pricing continued to be favorable for both Industrial segments, and Construction net sales grew by approximately 6%.

Agriculture net sales decreased for the quarter by 2.6% to $4.38 billion primarily as a result of lower industry volume, mainly in EMEA and South America partially offset by favorable mix in North America and continued price realization.

Source:

Mass layoffs at major tech firms have opened the talent pipeline for Illinois-based Deere & Co. and rivals who are eager to add tech workers to their payrolls as they expand into autonomous tractors, mining trucks, and other smart farming technology.

With an abundance of job openings, the companies are offering remote work arrangements and opening new offices in major cities like Austin and Chicago, a potentially attractive draw for workers who don’t want to move to smaller Midwestern cities, where many of the companies are based.

The executives said the newly available tech talent could inject much-needed expertise into farm equipment manufacturing, helping to transform the industry through the use of more artificial intelligence and automation.

Historically, it has been difficult for construction and agriculture equipment manufacturers to compete with Silicon Valley compensation packages, Scott Wine, chief executive of CNH Industrial CNHI, an American-Italian machinery maker, said in an interview.

“They were sucking so much oxygen out of the air because of their significant budgets,” Wine said. “Now, they’re not hiring and they’re firing – so it just means we’re getting a much larger pool of potential candidates that we can call upon.”

CNH hired more than 350 engineers last year, some of whom came from Amazon.com and Microsoft Corp, Wine said. CNH expects to spend more than $1.4 billion in research and development as the company scales precision agriculture offerings in 2023, he added.

The combine harvester producer has increased its focus on agriculture in recent years to meet farmers’ equipment demand, stacking its tech workforce with highly skilled workers in automation and artificial intelligence.

REMOTE-CONTROLLED

Deere’s main rival, Irving, Texas-based Caterpillar Inc. CAT, is also making a big push to recruit tech talent. New hires in machine learning, computer science, and software engineering were up 30% in 2022 from the previous year, Karl Weiss, chief technology officer at Caterpillar, said in an interview.

The manufacturer has invested in digital products to improve construction safety using artificial intelligence. It had roughly 500 open tech jobs in December 2022 and it is looking to fill roles with the outflow of laid-off tech workers, Weiss said.

“The layoffs in the tech community have not been lost on us. We’re actively talking to those employees,” he said.

TECH TALENT PURGE

Thousands of workers have left or been laid off from tech giants Amazon, Microsoft and others during the biggest purge of tech talent since the dot-com crash of the late 1990s.

Large tech companies shed more than 150,000 workers in 2022, according to tracking site Layoffs.fyi. During the COVID-19 pandemic, big tech firms hired aggressively to capitalize on advertising dollars as lockdowns prompted a surge in social media use and online purchases.

Layoffs at West Coast-based technology companies have coincided with Deere and CNH boosting investment in artificial intelligence and precision agriculture products, such as automated fertilizer applicators, that they hope to sell to farmers who are trying to boost food production at a time of global shortages.

While the availability of tech workers is plentiful now, industry experts say the hiring window is short for companies to reel in tech workers who also have opportunities at startups.

The goal is to offer prospective employees the best of both worlds: work from home or come to a city office that more closely resembles a Silicon Valley tech campus.

Deere has its global headquarters in the small city of Moline, about 165 miles west of Chicago, but opening a tech hub in Chicago’s trendy West Loop neighborhood last year has helped it be more visible to prospective job candidates who want to live in metro areas.

In an acknowledgement that not all tech workers want to relocate to the Midwest, Deere is also hiring employees in Austin, Texas, where it opened an “Innovation Hub” in 2022 and in San Francisco, where it has had an office since 2017, said Johane Domersant, global director of talent at Deere.

Previously, Deere would have required new employees to relocate to the Midwest, likely to Iowa or Moline.

“We are going to go where the talent is and that is a different strategic bent that we wouldn’t have done in the past,” Domersant said.

Source:

CNH Industrial announced that Brad Crews, President North America, has announced his retirement. Mr. Crews is a longstanding member of the Company’s Senior Leadership Team and is also the leader of the North American Agricultural Segment. During 2023, Brad will focus on a new role, supporting Derek Neilson, President Agriculture, by spearheading various strategic initiatives. Mr. Crews will retain his current responsibilities until his replacement as President, North America, is announced.

Brad Crews has been key to the growth and success of CNH Industrial during his 28 years with the company, during which he held a series of leadership roles in manufacturing, quality and operations.

Agriculture

In North America, industry volume was flat for tractors over 140 HP and was down 16% for tractors under 140 HP; combines were up 3%. In Europe, Middle East and Africa (EMEA), tractor and combine demand was down 1% and 24%, respectively, with combine demand up when excluding Turkey and Russia. South America tractor demand was up 4% and combine demand was down 14%. Asia Pacific tractor demand was up 11% and combine demand was up 21%.

Net sales were up 19%, due to favorable price realization and better mix, mostly driven by North America and South America.

Order book in Agriculture was up almost 5% year over year for tractors. Order book for combines was down almost 6%, with declines in North America and South America offset partially by growth in EMEA. At more than 3 times the pre-pandemic levels, order books remain strong in all regions and key products, with the company accepting orders only through Q1 2023 in most regions as cost uncertainties remain.

The expansion includes expanding product offerings and launching international pilot test programs for regional market validation.

“Fruit and vegetable farmers have long been ignored in the electrification and automation movement, and that’s why the Monarch platform is built with them in mind,” said Praveen Penmetsa, the company’s co-founder and CEO.

In related news, CNH Industrial has entered into an exclusive, multi-year licensing agreement for electrification technologies with Monarch Tractor.

“We are confident that the new pathways provided by Monarch will rapidly strengthen our competitive position in sustainable precision farming,” said CNH CEO Scott Wine. “Their talented team, exceptional engineering acumen and Silicon Valley R&D ecosystem will greatly enhance our digital capabilities.”

Sources: Monarch Tractor, CNH

The Burlington plant will continue production of backhoes, tractor loaders and rough terrain forklifts.

Source: The Hawk Eye

For the March-ending quarter, net sales in agricultural equipment climbed 35.4 percent.

CEO Scott Wine said the company expects the ag recovery “to continue and perhaps significantly escalate.” He also said CNH sees “notable strength in North and South America for combines and tractors with overall solid demand across all regions.”

CNH characterized the partnership as “an important step toward further enhancing long-term sustainability, enabling the world’s farmers and agribusinesses to realize profitable zero-emission farming.”

The California-based Monarch was founded in 2019. Last year, it introduced a fully electric, driver-optional smart tractor.

“Monarch is pioneering tractor technology that incorporates electrification, autonomous use, and data management. These are three of the key pillars supporting sustainability, productivity, and profitability, both for CNH Industrial and for our farming customers,” said CNH CEO Scott Wine.