US tariffs hit John Deere

Tractor maker says falling sales and higher metal tariffs would cost it $600 million

- KEVIN DRAPER

Josh Enlow buys and sells used tractors every day, filling a vast lot in Tulsa, Oklahoma, with hundreds of agricultural and construction machines.

His customer base has shifted recently, as farmers and ranchers who would buy only new machines are now coming to his Enlow Tractor Auction interested in his secondhand equipment.

"The increases in new pricing has definitely driven people back to the used market," Mr Enlow said.

The list price for new tractors rose at least 60% over the past eight years, according to the University of Illinois Extension, with some models more than doubling in price, costing at least $250,000 more than they used to.

That's bad news for companies like John Deere, the leading supplier of agricultural machinery in the United States. The company reported a record profit two years ago, but President Donald Trump's tariffs and trade policies are making the market more challenging and unpredictable for the business and its customers.

One of the country's largest manufacturers is worse off now than it was six months ago. Last month, John Deere said net income in its most recent quarter was down 29% from a year earlier. Higher tariffs, primarily on steel but also on aluminium, have cost the company $300 million, with nearly another $300 million expected by the end of the year.

This summer the company laid off 238 employees across factories in Illinois and Iowa.