The explosive modernisation of eastern European agriculture has fuelled massive growth in sales for German tractor maker Fendt.
Sales of Fendt tractors have rocketed on the back of the modernisation of eastern European agriculture and improved farm incomes worldwide.
Until 2003 the company’s production had hovered around 10,000 units/year. Then, as the pace of farm development has picked up, demand for Fendt’s high-tech tractors has leapt by 50%. In 2007 the company’s turnover broke the €1bn barrier.
“In the last year alone we’ve seen our orders swell from 13,000 to 15,450,” says managing director Hermann Merschroth.
“Much of it has been driven by improved farm incomes worldwide, but we’ve made particular gains in the former Soviet states.”
Although Germany remains the Bavarian brand’s biggest customer, sales in the UK have also grown significantly. This year the company has received orders for nearly 500 tractors to give it a 3.2% share of the market. In 2007 that figure was just 2.4%. It is claimed that in the over 200hp sector Fendt has a 21% slice of the cake.
Fendt’s sales are growing rapidly in central and eastern Europe. In particular, the region’s burgeoning construction sector is swallowing up vast numbers of the Bavarian-built tractors where their stepless Vario gearboxes are proving particularly popular for speed-sensitive work. One of the Czech Republic’s biggest earth-moving and land-clearance contractors – Milata – runs over 45 300hp and 360hp Fendt 900s.
Under the direction of parent company, Agco, Fendt is to change tack with more of a focus on harvesting equipment. Previously the company could claim to be one of the only manufacturers concentrating its efforts solely on tractors. Massey Ferguson combines have been sold throughout Germany in green livery for a number of years, but the plan is now to extend their reach.
Stretching from 176hp to 459hp, the harvester line-up has recently been expanded to cater for a broader range of potential customers. Five and six straw-walker models are built by Laverda at Breganze in Italy. Larger six and eight walker machines hail from the ex-Dronnenborg MF plant at Randers in Denmark and the range-topping rotary comes over the pond from the Hesston factory in Kansas.
Now under development at Fendt’s base in Marktoberdorf, southern Germany, the company’s long-awaited and much talked-about forager will further strengthen the brand’s harvester offering when it makes its expected debut appearance at Agritechnica in November 2009.
Fendt parent company Agco is pressing ahead with consolidating its many subsidiaries into four main brands – Massey Ferguson, Challenger, Valtra and Fendt. Worldwide growth of 25% is set to take the group’s turnover past $8bn this year. Much of this is driven by booming biofuels markets in North and South America and rocketing demand for meat in the Asia.
The company is striving to secure a joint manufacturing venture in China, although negotiators are reported to be grappling with partner requirements of a minimum 50:50 agreement. Agco insists it must hold a majority shareholding.
Elsewhere other joint ventures are flourishing. A deal with Russian engine manufacturer CTP will see Agco bringing state-of-the-art technologies to ease emissions compliance and an output of 20,000 engines each year for tractors and construction kit. The company’s 50% share in Italian combine maker Laverda and implement manufacturer Fella has seen its harvester line-up swell rapidly and provided Agco dealers with the opportunity to offer a wider range of kit.