• Discounts and special offers
  • Subscriber-only articles and interviews
  • Breaking news and trending topics

Already a subscriber?

By signing up, you accept Moneywise's Terms of Use, Subscription Agreement, and Privacy Policy.

Not interested ?

‘Good American jobs shifted to Mexico’

In June 2022, Deere announced plans to move tractor cab production from its Waterloo, Iowa plant to Mexico, with the transition slated for completion in 2024.

Further relocations are on the way. By June 2024, the company had also announced that it will move manufacturing of skid steer loaders and compact track loaders from its facility in Dubuque, Iowa to Mexico by the end of 2026.

Laursen cautioned that shifting American jobs to Mexico may not bode well for the company’s reputation.

He explained that John Deere is known for making quality equipment, and that “the reason why farmers and others buy this expensive equipment — is because it's made by American union workers.”

Laursen expressed doubts about the brand's continued allure if this changes. “When you take that out of the equation, what do you got left? I don't think anyone is interested in seeing good American jobs being shifted to Mexico, especially these loyal farm families that are buying John Deere equipment for generation after generation, and even live in some of these small communities that will be devastated by the loss of jobs,” he said.

Discover how a simple decision today could lead to an extra $1.3 million in retirement

Learn how you can set yourself up for a more prosperous future by exploring why so many people who work with financial advisors retire with more wealth.

Discover the full story and see how you could be on the path to an extra $1.3 million in retirement.

Read More

‘John Deere is not hurting for cash’

In a statement to Fox Business, Deere said, “We can confirm Deere leadership recently communicated that rising operational costs and declining market demand requires enterprise-wide changes in how work gets done to achieve our goals and best position the company for the future.”

In May, Deere lowered its forecast, projecting a net income of $7 billion for fiscal 2024. Previously, the guidance range was $7.50 billion to $7.75 billion.

For the second quarter of Deere’s fiscal 2024, which ended Apr. 28, the company reported a net income of $2.37 billion or $8.53 per share, which beat expectations but was a decrease from $2.86 billion or $9.65 per share in the same period last year.

Still, Laursen contends that the company is not lacking in funds, highlighting its substantial returns to shareholders and executive compensation.

“The thing to remember is John Deere is not hurting for cash,” Laursen stated. “They've been in the wake of record profits for years now. In fact, last year, in 2023, they experienced $10 billion in profit. They spent $7.2 billion in stock buybacks, paid $1.4 billion in shared dividends, and awarded $26.7 million to CEO John May.”

Larsen also noted that the company is in the process of acquiring new property in Ramos, Mexico to build new factories — a move he views critically.

“Let's not kid ourselves. These are jobs that won't be returning,” he remarked.

Deere shares have fallen by around 13% in 2024.

This 2 minute move could knock more than $600/year off your car insurance in 2024

Insure.com makes it easy to compare quotes from trusted brands like GEICO, Progressive, and Allstate, ensuring you get the best deal. Drivers who switch save an average of $694/year!

In just 2 minutes, you can provide some basic info about yourself and your vehicle and instantly access tailored offers, with potential savings of more than $50/month.

Jing Pan Investment Reporter

Jing is an investment reporter for MoneyWise. He is an avid advocate of investing for passive income. Despite the ups and downs he’s been through with the markets, Jing believes that you can generate a steadily increasing income stream by investing in high quality companies.

Disclaimer

The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter. Advertisers are not responsible for the content of this site, including any editorials or reviews that may appear on this site. For complete and current information on any advertiser product, please visit their website.