You may have heard that John Deere is leaving America, in favor of a gigantic new manufacturing facility they are building in Mexico. While this is partially true, it’s hugely overstated, just like President Trump’s massive over-reaction to the announcement. It’s not “fake news”, but it is a much more complex situation that is worth 9 minutes of your time to understand.
This video explains why John Deere is opening that Mexican factory and that they are not abandoning the United States.
John Deere’s expansion into Mexico is intended to strengthen their position in the growing Latin American market. Mexico, in particular, has shown significant growth in the consumption of construction equipment. A local manufacturing presence allows John Deere to be closer to this key market, better understand regional needs, and respond more quickly to demand. This nearshore strategy also helps to build resilience in the supply chain by reducing reliance on longer international shipping routes, a vulnerability highlighted by recent global disruptions.
By moving some less complex operations to Mexico, the company can free up capacity and resources in its U.S. plants to focus on manufacturing more technologically advanced and higher-value equipment. This allows John Deere to continue investing in innovation and producing cutting-edge machinery in the United States, while strategically leveraging its global facilities for other product lines.
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