Equipment Industry Reacts to Trump's 200% Tariff Threats Against Deere

John Deere’s plans to move some production to Mexico have drawn the attention of presidential candidate Donald Trump.

During a September 23 panel hosted by conservative nonprofit organization Protecting America Initiative in Smithton, Pennsylvania, the former president said that if John Deere moves production there, all products imported from that factory into the U.S. would face a 200% tariff, if he's elected president, according to a Reuters report.

“As you know, they've announced a few days ago that they are going to move a lot of their manufacturing business to Mexico," said Trump at the event. "I am just notifying John Deere right now that if you do that, we are putting a 200% tariff on everything that you want to sell into the United States.”

Earlier this year, John Deere confirmed it plans to move production of midsize skid steers and compact track loaders in 2026 from the Dubuque Works plant in Iowa to a new facility to be built in Ramos, Mexico. Deere says the relocation is a response to “rising manufacturing costs” and to “improve operational efficiencies.”

Several rounds off layoffs at various Deere facilities have been announced over the course of 2024, including 100 at the Dubuque Works plant and some salaried employees.

John Deere currently operates four locations in Mexico:

• Monterrey – manufactures components, planters and small skid-steer loaders. Also houses an engineering technology center, credit operations and regional parts distribution.
• Ramos Arizpe – manufactures farm and utility tractor-mounted loaders, operator stations, components and hydraulic cylinders.
• Saltillo – manufactures ag tractors, transmissions, axles, electronics and components.
• Torréon – manufactures engines, electronics and axles.

Trump’s press office did not respond to a request for clarification on whether this proposed tariff would apply solely to the upcoming factory or to all Deere’s Mexico operations.

In a statement to Equipment World, John Deere said, “Deere is constantly reviewing production efficiencies and product/component moves to optimize manufacturing floor space in the U.S. and to leverage the highly skilled production workforce in the U.S. to build our most innovative new machines like the 9RX.”

John Deere isn't the only OEM with plans to bring manufacturing to Mexico. Bobcat recently broke ground on a $300 million plant in Mexico to increase its production of compact track loaders and skid steer loaders. Bobcat denied claims the new factory would result in the loss of U.S. jobs.

Industry Reactions

This isn’t the first time Trump has been at odds with the equipment industry over tariffs. In 2018, as manufacturers rolled out price-hikes to dealers to counteract tariffs, then president of the Association of Equipment Manufacturers Dennis Slater told Equipment World that, “Nobody wins in a global trade war. American workers, farmers, consumers, and the U.S. economy lose. Not only will these tariffs threaten many of the 1.3 million jobs our industry supports, they also hurt farmers who are already reeling from low commodity prices.”

Bob Sinclair, CEO of 13-store Iowa John Deere dealer Sinclair Tractor, however, is not particularly phased by this statement from Trump, telling Equipment World, “Politicians say a lot of things. I personally focus on things I can control.”

Marc Johnson, a principal at CPA firm Pinion, who works primarily with equipment dealers and distributors, referred to Trump's comments as "campaign talk" and "populism at its best."

"My initial thought was that this is campaign talk – populism at its best and frankly easy to see benefits of threatening U.S. companies when they do this," Johnson said. "With that said, labor costs have risen exponentially each year since COVID everywhere – the manufacturer and the dealership, and it is a legitimate strategy to look at ways that you can decrease your largest expense. But it’s like anything when it comes to taxes and government – you like the sounds of it, but don’t want it in your backyard. Please go tariff someone else or some other industry, as ours is hurting."

In a statement to Equipment World, President & CEO of Associated Equipment Distributors Brian P. McGuire had the following to say about Trump’s proposed Deere tariff:

“The equipment industry relies on global supply chains. Tariffs, particularly on imports from key trading partners, increase costs, invite retaliation and create market uncertainty, thereby detrimentally impacting equipment dealers, manufacturers, and our customers. Ultimately, the biggest loser is the American consumer who will be forced to pay more for food, energy and other necessities. The way to incentivize companies to invest in America is through pro-growth tax and regulatory policies that lower operating costs and ensure businesses have access to a skilled workforce, not through trade barriers.”

A recent website visitor poll from Equipment World revealed that 68.4% of construction equipment dealers are “very concerned” about the upcoming election.