The market environment is difficult. Peter-Josef Paffen, Chairman of the AGCO/Fendt Management Board left no doubt about that on 1 September 2016 at the international AGCO/Fendt Press Conference in Marktoberdorf. Business operations at Fendt, however, are still running stable and according to plan. Further growth potential is forecast for Europe and also worldwide; the agricultural equipment manufacturer has its sights on new targets. Intensive investments are continuing to be made in Research and Development and, with the new Fendt Nature Green, the Fendt brand has undergone a visual evolution.
The market environment is difficult. Peter-Josef Paffen, Chairman of the AGCO/Fendt Management Board left no doubt about that on 1 September 2016 at the international AGCO/Fendt Press Conference in Marktoberdorf. Business operations at Fendt, however, are still running stable and according to plan. Further growth potential is forecast for Europe and also worldwide; the agricultural equipment manufacturer has its sights on new targets. Intensive investments are continuing to be made in Research and Development and, with the new Fendt Nature Green, the Fendt brand has undergone a visual evolution.
“The economic environment in the agricultural equipment industry remains challenging,” said Peter-Josef Paffen at the beginning of the AGCO/Fendt Press Conference, and backed this up with the monthly figures from the CEMA Business Barometer of the European agricultural equipment industry. “After the mood in the industry improved in continual, small steps in 2015, the Business Barometer headed downward again in the first four months of the current year. In the months of May to July, the mood remained constant. In July, for the first time again, future expectations were estimated to be better than in the previous months. This may indicate that the decline has bottomed out and the mood in the European agricultural equipment industry may be improving again.
Despite difficult environment, business according to plan
Despite the difficult environment, business for the Fendt brand and the AGCO GmbH Marktoberdorf remains stable according to plan. “In 2015, we achieved tractor sales of 13,678 units. Together with the Fendt harvesting machines and strict expenditure discipline, we were able to achieve decent sales figures and results again in the past year,” emphasised the Chairman of the Management Board. Although the competition for unit sales and market share has become fiercer in the current year 2016, due to the ongoing low global market prices for major agricultural products, Fendt is continuing according to plan at about the same level as in the previous year. The sales targets are 13,500 Fendt tractors, slightly higher sales of Fendt combines and balers as well as stable sales for the Fendt Katana forage harvester. For forage harvesting, delivery of the first machines will begin in September. More than 500 Fendt mowers, tedders and hay rakes will be sold by the end of the year. The market launch for the Fendt Vario-Liner begins in 2017.
Good market position in Germany – European target: ten percent market share
In 2015, the tractor market in Germany declined by about seven percent following a stable phase lasting several years. “With 5,493 registrations, we achieved a market share of 17 percent, like in the previous year. In the first half of 2016, we took top place for tractors, with a market share of 19.7 percent. However, due to low investment confidence, the market decline continued with a minus of 9.7 percent. Our goal is to maintain, or slightly expand, the good market position in Germany until the end of the year,” said Paffen. Over 90 percent of Fendt tractors and harvesting machines go to the region Western and Central Europe. “Our medium-term objective is to continually increase Fendt’s market share in Europe, from its current 8.3 percent to ten percent. We already have a good market share in Germany, France, the Netherlands, Switzerland and Austria, ranging from ten to nearly 20 percent. We want to maintain, stabilise and – where possible – continue to expand these two-digit market shares. We continue to see growth potential in the EU countries Great Britain, Spain, Italy and Scandinavia as well as in all Central European counties, which have an average market share of about five percent. We are assuming that a market share of ten percent is feasible for Fendt in each individual country in Europe.” “
Global market opportunities for the Fendt brand
In general, Fendt aims at offering the entire Fendt product line around the world, in all countries and regions with modern farming. “In the meantime, outside of Europe, there are now stable and expandable marketing structures in North America and in the regions Australia/New Zealand and Japan/South Korea. We will build on these. Africa also offers potential for Fendt; the first Fendt tractors in South Africa and selected North African countries are already in operation. In addition, in 2016 we will also target completely new markets for Fendt, for example, South America. At the end of April 2016, we presented our new flagship, the Fendt 1050 Vario, at the Agrishow in Ribeirão Preto, Brazil. There is an interesting market for powerful state-of-the-art machinery in this region. In Iran, we participated for the first time in the agricultural equipment fair Agrotech in Shiraz. We also see future market potential here. The third new market for Fendt is China. There are now regions in China that have large-scale, modern farming operations; we are preparing for the market launch here step by step,” said Paffen, explaining the global sales strategy.
Fendt Nature Green – The freshest green in the agricultural equipment industry
In September 2016, a new era begins at Fendt: starting immediately, all products will be delivered in the new Fendt Nature Green colour. “The new Fendt Green is brighter, more vibrant, more vivid, more complex and more dynamic. We see it as the freshest green in the agricultural equipment industry,” says Paffen. Starting September, production and delivery of the new flagship series Fendt 1000 Vario will begin in higher numbers. Delivery of the mowers, tedders and hay rakes of the new Fendt forage harvesting line will also begin in September. “Starting now, we will offer a comprehensive full product line under the Fendt brand: Fendt tractors ranging from 50 to 500 hp, the two forage harvester models Fendt Katana 65 and 85, a broad line-up of Fendt combines ranging from 180 to 500 hp, Fendt balers and the Fendt forage harvesting machines. Thus, we have taken giants steps towards the implementation of Fendt’s exclusive full-line strategy (Route 66). Fendt dealers and distributors can exclusively offer a comprehensive Fendt line-up with attractive services starting immediately. These services include first-class replacement parts availability, flexible financing offers and further attractive services such as Fendt Pro Service for new machines and Fendt StarCertified for used machines.”
Some 4200 employees
At the end of December 2015, a total of 4,220 people were employed at the four German AGCO locations Marktoberdorf, Asbach-Bäumenheim, Hohenmölsen and Fella in Feucht. Mid-year the workforce totalled 4,203, which was slightly lower than last year’s numbers and can be traced back to increasing productivity within the company.
Development budget continues at a high level
Fendt continues to forge ahead in the area of research and development, despite short-term market fluctuations. Important future projects are going according to plan. For 2016, the development budget lies at exactly the same level as in the previous year, around 60 million euros.
