28 May 1999

Case/NH names to remain

CASE and New Holland enthusiasts will still be able to buy their favourite tractor and machinery brands after the takeover, but some of the components they are made of may be interchangeable.

The takeover, which was announced last week, brings Case and New Holland together in a giant new company with a $12bn a year turnover. It is the latest and biggest in a long succession of deals which have littered the recent history of the tractor and machinery industry with once familiar brand names.

Many of these names were discarded or lost their distinctive product identity after a merger or takeover, but if the New Holland bid for Case is approved, both brand names will continue, according to Jeff Walsh. Mr Walsh, communications, planning and development manager at the New Holland international headquarters in London, says the brand names are simply too valuable to lose.

"Both brand names are internationally known and respected, and they represent a considerable equity value. There is certainly no intention to close either of them down," he says. "In fact, we will be doing just the opposite. We will be putting a lot of effort into promoting and developing both names in the future, and we will be strengthening both the New Holland and the Case product ranges."

The takeover will also provide a chance to strengthen the dealer network, he says. Case has 4900 agricultural and construction equipment distributors and dealers worldwide, and there are 6100 selling New Holland products.

Case and New Holland both have strong dealer networks in the UK, and it is unlikely that we will see the wholesale closure of dealerships, which has followed previous takeovers and mergers.

Annual cost savings after the takeover will total up to £500m within three or four years, says New Holland, and most of this will be achieved by integrating some of the production and component sourcing. In the long term this is likely to mean closing some of the new companys numerous tractor and machinery factories, and it will also mean component sharing in Case and New Holland equipment.

Benefits for customers are likely to include a wider choice of financial packages and more product innovation. Financial services was highlighted as one of the development priorities when the takeover was announced, with the aim of offering customers a bigger range of services, an area where John Deere has been particularly successful.

"Product development will benefit form a rationalisation of the separate research programmes at Case and New Holland. By combining the strength of the two R&D functions and eliminating duplication it will be possible to provide customers with more innovative products in the 21st century," says Mr Walsh. &#42