European Company Profile: AGCO (December 2012)
Off-Highway Research's Company Profiles are objective analyses of major construction equipment manufacturers or component suppliers.
Typical coverage includes:
|Company Structure||Manufacturing Facilities||Component Sourcing|
|Ownership||Marketing and Distribution||Production|
|Financial Analysis||Research and Development||Employees|
This profile describes the youngest of the major participants in the world farm machinery industry, AGCO, with special reference to its operations in Europe. AGCO is an American company but it is a very significant force in the European industry, owning the Massey Ferguson, Fendt and Valtra brands.
AGCO is a famously acquisitive company and the senior managers believe very firmly in the value of brands. It is therefore convenient to look at the history of the company in terms of the brands that it has added to its portfolio over the years. The history begins with the purchase of Deutz-Allis in 1990.
When AGCO incorporated Massey Ferguson into its portfolio, it bought a company with sales 58 per cent located in Western Europe and so changed the centre of gravity of the company to Europe. Buying Fendt further increased the importance of Europe.
The acquisition of Ag-Chem in 2000 restored the primacy of the North American market to the corporation, moving the region up to account for one third of sales. Similarly the success of the Challenger lines with the North American Caterpillar dealers kept the region to the fore. Then the addition of the Valtra European tractor and engines unit brought Europe back up, so that by 2011 it was taking 52 per cent of the total.
In recent years the high value of the euro in relation to the dollar has boosted Europe’s share of the total by perhaps two percentage points but in general its position in 2011 was explained by strong markets, especially in the UK, France, Germany and Scandinavia. North America is an important region that usually accounts for 20 to 22 per cent of turnover. In 2011 it was boosted by good sales of high horsepower tractors, combine harvesters and sprayers.