AGCO to promote Fendt as full line machinery supplier

With much trumpeting of the event beforehand, Fendt held its annual online press conference last week with the promise of lots of new goodies in the bag.

AGCO to promote Fendt as full line machinery supplier

AGCO to promote Fendt as full line machinery supplier

Chief among these were additions to the 700 series of tractors and some tinkering with the entry level combine range, replacing the E series with the more cuddly named Corus brand.

Rosy picture for Fendt

In addition to outlining the new hardware, various management figures took to the stage to offer their vision of the future of the company and its products.

Naturally, we were blessed with a grand tour of how it fitted into the global farming scene although it was not always clear whether it was just Fendt, or AGCO in general, that was being talked about.

Fendt and Challenger crawler sales in both North and South America are expected to double this year

Brazil appeared to be a one growth area in particular which Fendt was proud of, indicating a solid increase in market share. Whether this was at the expense of its sister company, Valtra, which has been building tractors there since 1960 was not, unfortunately, divulged.

In the European market we were informed that it is only the component supply issue that is likely to stop the company achieving its 20,000 tractors sales target this year, an ambition it has held for some time now.

Despite this, the company has shifted its focus onto hitting the 24,000-25,000 unit sales mark within the next few years, and believes it to be quite possible.

Plans for growth

Sales were also hit by the Cyberattack of last May. This caused an 8% loss in production hours during the second quarter of the year, according to AGCO’s earnings call of July.

It was, according to Eric Hansotia, CEO of AGCO, conducted by a group associated with the Russian military.

Later, in response to a question concerning the impact on company operations caused by conflict, he laboured the point that AGCO was pulling out all the stops to help Ukranian farmers, with no mention of its Russian customers.

To what extent this was appreciated by his German colleagues can only be guessed at, for it is in stark contrast to Claas which recently pledged its support for all its customers wherever they find themselves on the geopolitical map.

Pushing the Fendt brand

Yet the presence of the AGCO CEO at the event suggests that the parent company attaches a growing importance to Fendt, a feeling reinforced by news that AGCO recorded a 61% increase in sales over the first half of 2021 in South America, with Fendt leading the way.

However much Fendt might be flattered by this, it is also noticeable that, in the same earnings call, Hansotia referred to the company as “our Fendt brand”, indicating that it wasn’t the techie stuff by itself that would impress the shareholders, more the way in which it is being packaged and sold to the customer.

Germany combine harvester brazil
German name but Italian built. AGCO is not shy of a spot of badge engineering

Taking Fendt full line is another objective listed by the CEO. This will of course dilute the German subsidiary’s technical input, for many of the non tractor machines are made in factories that have no connection with Fendt other than being owned by the same corporation.

Exploring the alternatives

Attention was also paid to alternative methods of fuelling tractors with mention of climate change and all the other buzzwords associated with the environment being dutifully paraded before us.

Fendt, we are assured, is serious about developing both battery power and hydrogen fuel cell technology, although progress so far is less than stunning.

e100 vario tractor Brazil battery
The e100 Vario on display at a previous Fendt press event in 2018

The e100 Vario tractor was announced in 2017, yet its coming to the market has been delayed and there is still no certain date beyond the vague suggestion that it will be available in the next couple of years.

Likewise, the development of hydrogen-powered tractors is forging ahead with a fleet of just two prototype tractors being sent out for farm trials within a year or so – perhaps.

Big factory, big investment

Meanwhile, the question of how this squares with AGCO’s recent €1 billion investment in a new range of internal combustion engines, and the Finnish plant constructed to build them, lies unanswered.

One may be forgiven for assuming that having spent that sort of money on contemporary carbon-burning engines, AGCO is not going to rush into promoting an alternative, and that appears to be the case.

It is telling that rather than give any detailed plans of how it intends to move on to other energy sources, AGCO only deploys the term ‘sustainability’, which is something of a catch-all phrase that sounds good, but could mean anything.

Taking a second look

As always, press conferences are a tightly controlled opportunity to present exactly what it is the company wants to say.

It is only by reading between the lines and considering other releases that may not share the same target audience that a more complete picture emerges.

In the case of the recent Fendt conference, at which only a small, carefully selected number of journalists were physically present, we were reassured that the super innovative and independent Fendt tractor company was going places.

Scraping away at the surface however, revealed a parent company determined to use the Fendt name to increase both profits and global market share.

Fair enough, that’s business, but it is good that we remind ourselves of this before getting too carried away by the public relations gloss.

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