CEO John May said ongoing margin pressures from tariffs would continue to weigh on its large farm equipment unit, although he expects to benefit from cost cuts and demand from two of its other units that serve forestry and small agriculture markets.

“We believe 2026 will mark the bottom of the large ag cycle,” May added.

Lower crop prices and rising production costs have prompted farmers to defer big-ticket purchases and opt for rentals or preowned units for large agricultural equipment including tractors and combine harvester.

Deere had also been considering production shifts, higher pricing and widening its portfolio of used equipment as it looked to offset the demand hit.

Tariff impacts

U.S. President Donald Trump’s sweeping tariffs have impacted companies across sectors, especially manufacturing and industrial firms that rely significantly on imported raw materials. In August, Deere said it expected a pre-tax tariff impact of nearly $600 million (C$843.9 million) in 2025.

Deere expects its annual net income for fiscal 2026 to be between $4 billion and $4.75 billion (C$5.6 billion to $6.8 billion) , below analysts’ estimates of $5.33 billion, according to data compiled by LSEG.

The farm-equipment maker posted a quarterly net income of $1.06 billion, or $3.93 per share, for the quarter, down from $1.24 billion, or $4.55 per share, in the year-ago period.

Analysts on average had expected a quarterly profit of $3.85 per share.

Its fourth-quarter revenue rose 11 per cent to about $12.4 billion from a year ago, topping estimates of $9.85 billion.

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GM shares were trading down nearly two per cent at midday, even though CFO Paul Jacobson said demand for GM’s trucks and SUVs remains strong in the United States.

GM has been able to raise prices in the U.S. over the past two years as supply chain bottlenecks kept production in check. Going forward, Jacobson said the opportunity to boost prices much further “isn’t there. We have to be more urgent around cost-cutting.”

GM will cut production to keep inventories in check, Jacobson said. The automaker earlier this year shut down a pickup truck assembly factory in Fort Wayne, Indiana, for two weeks.

GM had set a goal of cutting $2 billion from operating costs by the end of 2024, with 30 to 50 per cent of the total being achieved this year (all figures US$). The response to a buyout program announced last month means GM will be at the higher end of that 2023 goal, Jacobson said during a presentation at a Bank of America conference.

GM will take a $1 billion charge in the first quarter, he said. The company had previously projected $1.5 billion in charges related to staff reductions.

Jacobson said GM is now allocating 75 per cent of its annual capital spending toward electric vehicle projects, which in the short term will be less profitable than the automaker’s combustion vehicles.

GM is in a good position to benefit from U.S. electric vehicle subsidies under the Inflation Reduction Act because of its investments in North American battery, raw materials and EV assembly, Jacobson said.

GM has three battery factories in North America, and will announce the location of a fourth domestic battery plant soon, he said.

Jacobson added that the company was going to have to “prioritize down” on growth businesses to focus on preserving cash. Some analysts have questioned GM’s continued investments in its Cruise robo-taxi business. Jacobson said Cruise is expanding and “executing really well.”

— Reporting for Reuters by Nathan Gomes in Bangalore and Joseph White in Detroit.

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Georgia-based Agco, whose brands include Massey Ferguson, Fendt, Challenger and Valtra, said in a statement it expects operations at some facilities to be affected for “several days and potentially longer.”

The ransomware attack comes at a time U.S. agricultural equipment makers were already facing persistent supply chain disruptions and labour strikes that left them unable to meet equipment demand from farmers.

Agco did not disclose the names of the facilities or if any data was stolen, but said it was still probing the extent of the attack that occurred on Thursday and working to repair its systems.

Tim Brannon, president and owner of B+G Equipment in Tennessee, told Reuters he has not been able to access Agco’s website for ordering and looking up parts since Thursday morning.

“We just have to trust that it will be over as soon as possible because we are coming into our busiest time of the year and it will be very damaging to our business and customers,” Brannon said.

Agco, which competes with larger rival Deere and Co., sells tractors and combines and manufactures and assembles products in 42 locations worldwide with 1,810 dealerships in North America.

Dealers are now struggling to keep up with orders that were already backlogged.

The company told dealers that it was “prioritizing” the most business-critical systems in an email read to Reuters by a dealer who declined to be identified.

“I’ve got about nine orders that I need to place right now,” the dealer said.

He said Agco told him “digital systems” had been impacted worldwide.

Agco did not respond to requests for additional comment.

Ransomware attacks have targeted food and fuel companies in the U.S. in recent years, including the Colonial Pipeline oil network and meat processing company JBS. Last autumn, at least three grain handlers in the Midwest were hit with ransomware attacks.

— Reporting for Reuters by Nathan Gomes in Bangalore and Bianca Flowers and P.J. Huffstutter in Chicago.

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