Pictures from the Agco Tractor Plant in France

 

This is just plain wrong! AC had a respectable market share into 1985 and there was (and still is) a tremendous respect for the AC tractors. What was MF doing in 1985? The problems within AC were related to a coal gasification project that was started during the Carter administration, and when Carter was expelled from the White House, the project was tabled and it cost AC nearly a Billion dollars - hence the sale of the ag business which was still profitable. As has been posted here many times, the 8000 series tractors were among the best on the market during their time and still command high resale prices. The biggest product snafu from AC in the early 80's would likely be the N7 combine, but that too got fixed. Look at the problems IH had, Ford was eventually sold to NH (where they wisely kept the colors), so there were many issues with all manufacturers, not just AC. Speaking of MF, along with going bankrupt, their prime tractor of the time (I believe the 2000 series) had many issues and We had local dealers that were just dropped with no parts or service remaining. So this is what the wrecking crew in Duluth is going to bank on!

 

I too, believe that NA is not an important player for AGCO going forward, but from a financial strategic position, I don't see how you can be successful in the global ag business without a strong play in NA. The naysayers can bloviate all you want about the "insignificance" of the Orange tractor customer, but facts are facts and they are speaking pretty loudly right now.

 

The last comment is to thank Terry for taking pics of a factory most of us will never see in person. Cool pics, Terry, and much appreciated.

 

Im not talking about AC sales in 1985. DOnt really care about that.  Im talking about AGCO NA sales this year. They have dropped considerably for some strange reason when by all accounts and compared with ther competitors they should be doing well. 

Not all marketing blunders are going to be made themselves known by letter writing campaigns ala Coke.  Seems to me farmers are the speak softly and carry a big stick type anyway. So there may be no verbal clamoring about the change, but it does seem to me that the customer base has spoken their dis-approval with their wallets.

 

How else would you explain those weird NA numbers?

 

Allis Chalmers had gone down the $hit chute before KHD bought them in  1985. KHD paid $107 M for a loosing company, lost money for five more years, and finally stopped the bleeding and dumped them in 1989, and took a one time loss of $282M. It wasn't like KHD trashed a successful company, they couldn't resuscitate a terminally ill aquisition.

 

What you're missing with the Coke analogy is that a LOT of Coke customers objected, and Coke responded. With orange AGCO tractors, the negative response is viewed by AGCO as relatively insignificant. There is no groundswell of concern being voiced to AGCO. They maybe get a few hundred letters, a few oranges left at shows from a minority making a point, but not enough objection to change their business decision.

 

There are many factors that impact AGCO's current sales. I'm sure the color change is one of them for some people. We have certainly seen that here. I'd assume the greater factor is People don't want to buy a tractor that will be considered obsolete, whatever the color. I wouldn't.  

 

An earlier post said it well. Allis Chalmers died in 1985. The remnants that exist are some other company. Nothing is forever. RIP.

 

Why are tractor sales in a tank since the Orange decision then? Your Coke analogy is great, but what did Coke do? They listened to their customers and gave them what they wanted, their old Coke back. Unlike the little bullheaded dictator in Duluth who spits in the face of customers. "You Vill buy what I tell You"! Similar as to why the Deutz fiasco failed, they ignored what the market place was telling them. Another example is Chrysler Corporation, never worked under Mercedes Benz. Cultures are different. There is HUGE opportunity for AGCO in North America but customer goodwill is evaporating rapidly and NA should be considered by any responsible executive as a "must win" for success. Gleaner is still the most respected name in North American harvesting but the world is rapidly going to green, red and NH yellow, simply because they are always there for support and service, even though they may not be the best. Look at what this stubby one man wrecking ball is doing: Orange gone, tractor sales tanked, He soon has Hesston eliminated, hay equipment sales tanking, attempts to eliminate Gleaner, failed due to their only success story in NA, but sure to be Challenged again. And we always hear from the "move on and accept it" crowd (Neville Chamberlain types) and my question to those who say the market can't support AGCO's founding brands, what is Challenger combine doing? Will they make it to 10 sales this year? If so, sales need to get in gear. Somehow though, big bucks continue to flow to Challenger as this is a good business case!

 Up until they changed the color I liked there tractors,were they the best?? I dont know,but they were orange just like every other tractor on this farm for 40 years. And now that they are gone,I have to change colors.No? Will I drive 50 miles for something I really dont want? No. I can drive 5 miles for something I dont really want. So it will be green. Yea I have had a couple Dts a Rt and a silver combine, but they tractors are all changed to a different color now, And the combine is next.

 

                                                       IG

 

There is no business rule that the larger company name prevails in a buyout, aquisition, or merger. It's the stronger managers that survive that control the companies direction. Don't take this as an endorsement of AGCO's management, I don't necessarily think there doing a very good job, but for whatever reason they are at the helm. 

 

When Coca Cola changed their formula for Coke there was a groundswell of customers that objected, and they retreated. AGCO is getting a relatively small percentage of their potential US customers objecting to this change, and it's not enough to change their direction. Of almost 4000 members of this far reaching Forum, for example, there's maybe 20, heck say 50 strenuous objectors. You have valid reasons, you're entitled, but you don't make a loud enough voice to be heard by AGCO management. They're writing off what they perceive to be a small loss in business as a cost of a marketing change in direction.

 

I not in total disagreement with you, but like you I'm voicing an opinion. I'm entitled. And yes, I'm a Packer fan. There are few venues for football like Lambeau Field.