In response to a challenging agricultural market, Deere & Co., the Illinois-based manufacturer known for its iconic tractors and combines, has confirmed layoff plans for salaried workers. The company, however, did not disclose the number of employees affected by the decision in Iowa and other locations.

Deere cited the projected decline in large farm equipment sales, estimating a drop of 20% to 25% compared to the previous year. The agricultural downturn, coupled with rising operational and manufacturing costs, has led to reduced customer demand and significant economic challenges for the company, according to a statement released on Wednesday.

Thus far in 2020, Deere has already implemented workforce reductions in various production facilities and research centers. Approximately 1,830 positions have been cut from locations including Ankeny, Dubuque, Ottumwa, Urbandale, Waterloo, and the Quad Cities' Davenport and East Moline, Illinois, plants. At the beginning of the year, Deere employed around 22,600 salary and production workers in Iowa and the Quad Cities.

Deere has assured employees affected by the layoffs that they will receive up to 12 months of severance pay based on their years of service, pro-rated pay linked to short- and long-term cash incentives tied to company performance, compensation for unused vacation or paid time off, continued access to health and wellness benefits, and one year of professional job placement services.

While acknowledging the difficulty in reducing roles across the company, Deere expressed confidence that these adjustments, combined with ongoing cost reductions and alignment of production and inventory levels, will position the company favorably for the future.

Simultaneously, Deere emphasized its commitment to U.S. manufacturing, highlighting a $2 billion investment in American factories since 2019. This includes the establishment of a new sprayer line in Ankeny, a combine assembly line at the Harvester Works plant in East Moline, and the introduction of a new tractor line in Waterloo. It is worth mentioning that Deere has faced criticism for its plans to shift some production to Mexico, including the production of tractor cabs and forage windrows in Iowa.

The layoff announcement reflects the challenging conditions faced by Deere & Co. in the current agricultural climate. The company remains hopeful that its proactive measures will help it navigate through the uncertainties, safeguarding its position in the industry as a leader in agricultural equipment manufacture.