Deere & Co. expects to incur over $500 million in tariff-related expenses this year, a sharp increase driven by its global manufacturing footprint and weakening demand for several key product lines, according to The Wall Street Journal.
The Illinois-based equipment manufacturer reported $100 million in tariff costs during the quarter ending April 27. According to the Journal, approximately 40% of these costs are attributed to its construction and forestry segment, which includes imported components from Japan and machinery manufactured in Germany under the Wirtgen brand.
The Journal noted that executives said that soft market conditions are limiting the company’s ability to pass on higher costs to customers. Demand for farm machinery has also slipped as farmers contend with lower crop prices and elevated production expenses.
As a result, Deere adjusted its full-year net income outlook to a range of $4.75 billion to $5.5 billion, down from a prior estimate of $5 billion to $5.5 billion.
The company’s widening tariff exposure reflects broader challenges facing multinational manufacturers as global trade tensions and supply chain dependencies strain operations.
