Tractor Makers Step up Plans to Provide all Farmers Need

AGCO

AGCO’s acquisition of Lely’s forage equipment lines enables it to fill round baler and forage wagon gaps in its livestock equipment lines.

The farm equipment industry’s key manufacturers continue in their quest to supply their dealers with almost every key machine required by both arable and livestock farmers, with the recent announcement of the acquisition of Lely’s forage machinery division by AGCO, parent of Massey Ferguson, Fendt, Valtra and Challenger.

With the deal, AGCO is able to further extend its line of forage equipment, which already includes big square balers made in its factory in Hesston, Kansas, plus mowers, tedders and rakes built in the Fella plant in Feucht, Germany, which it acquired along with the Laverda combine plant in a 2010 deal with former owner ARGO. Lely’s existing mowers, rakes and tedders look likely to be phased out in favour of the Fella-based products, according to an AGCO statement, but the acquisition gives AGCO its own round baler line – formerly it had sourced machines through Kverneland. Lely has also previously shown a prototype non-stop round baler project.

The Lely acquisition also gives AGCO access to a line of forage wagons. While it has shown a prototype (Fendt Cargoliner) wagon of its own in development, it remains to be seen whether the established Lely range, which the latter firm developed from its own acquisition of former Mengele technology, will provide a more economic and easier route to market via proven machines.     

The move echoes last year’s deal between CNH Industrial and DLG, owner of Kongskilde Industries, for the former to acquire the latter’s field equipment lines – its tillage and forage products – with DLG remaining owner of Kongskilde’s grain handling business. It also follows the purchase in 2012 of the Kverneland full-line arable and grassland implement business by Japan’s Kubota.

AGCO

Lely plans to focus on robotic farm equipment developments – the firm is well-established in robot milking and other dairy equipment.

The sale of its field equipment business does not mark the end for Lely in farm equipment, though. The firm reinvented itself some years ago by selling off its arable equipment lines to become a focused livestock machinery firm specialising in grassland machines and the robotic milking and other dairy equipment it had developed. Now, that latter product line – which includes other robotic machinery such as automatic feeders and scrapers – is Lely’s core focus, and the firm says it plans to further research and develop new ideas in agricultural use of robotics.

There would appear to be two particular trends resulting from these developments. Firstly, the tractor manufacturers who have the strongest influence on many farm equipment dealers are seeking to supply them with as many as possible of the core agricultural machinery product lines required by farmers. However, this is not the first time this has been tried – a number of the key tractor firms offered long product lines in the 1970s and 1980s, before retrenching to focus on their core money-making products – tractors, combines and a few other lines such as balers.

The second trend is that such moves could yet result in a two-tier farm equipment dealer network, split between those franchised to the big full-line tractor makers, and those operations focusing on more specialist products, such as dairying equipment, tillage and drilling machinery, spraying technology or grain drying/storage. The expansion of the big manufacturers and the specialisation of others would appear to be far from over.

Charles Spencer

About Charles Spencer

Community Manager at Agriaffaires! You will find here all the latest agriculture and farm equipment news!