Out on the farm, the agricultural machinery industry is usually seen in the single light of the customer and dealer, with manufacturers, such as Claas, being thought of as distant entities somewhere out there in another part of the universe, cold and unknown.
This is not a situation that all manufacturers are happy with, and most would wish to keep as close to their customer base as possible, and this is certainly true of the family-owned companies on the continent.
Claas is one such company and it recently threw its doors in Germany open to Agriland, dealers and its own staff in a bid to update the world on the current situation and its future plans.
And it is the current situation that is of concern to manufacturers although they might profess to dismiss this season’s sharp drop in sales as a blip rather than a trend.
Like all manufacturers, the reduction in turnover is being given as 15-20%, or thereabouts, yet this is not considered a new normal by any means.
In his welcoming comments, Matthias Mumme was keen to explain that whatever the economic situation, the development of new products must continue and indeed, Claas did have a lot of news concerning new machines and updates to the present range.
Check out the video below from Agriland’s recent visit to Germany to see firsthand the latest developments from Claas.
Although significant, the drop in sales has not resulted in the shedding of any full-time factory staff, nor is there any short-time working according to Uli Nickol, site manager and managing director of Claas Saulgau GmbH.
However, he goes on to warn that machinery prices will not be dropping despite the fall in the cost of steel and the easing of the supply line.
There are many other factors involved in pricing an implement; energy and transport costs being two major items while the unions have asked for a 7% increase in wages, twice what the company has budgeted for.
Machines are also getting bigger and more complex, adding to both the build and distribution costs.
The present prices are unfortunately, it would appear in this case, the new normal.
Deep roots
Companies such as Claas have not been with us for over 100 years without meeting and overcoming these challenges before, and that spirit or resilience persists today.
This becomes apparent when viewing the latest activity at the Bad Saulgau facility in Bavaria which produces mowers, tedders, rakes and headers for Jaguar forage harvesters.
An investment programme of over €50 million will see it enlarged and updated throughout, with a brand new logistics centre currently being built on site.
New warehouses seldom excite the imagination, but Claas is adamant that this addition to the factory will greatly increase the efficiency of the manufacturing operation and add to the overall flexibility.
This is essential when considering expansion into the southern hemisphere with its opposite seasons to those of the north; the company is thinking ahead and preparing the ground carefully.
Claas sets its course
Automation and the dreaded digitalisation of everything is another topic that many tend to avoid, yet it is happening, and is unavoidable in that tractors and a growing number of implements are already reliant on computing power to a large extent.
Claas has settled on a roadmap it refers to as the 3As – the first A is for Advanced, which is where we are now. It covers such items as GPS and driver assist software.
The second A is for Automation which includes automating tasks such as headland management and remote control of tractors, as in the unloading of combines.
These systems are starting to became available and are achieving a wider acceptance.
The final A stands for Autonomy and this represents the largest and most ambitious step forward yet with Claas itself not expecting it to be available for another decade or so.
We were promised that autonomous vehicles would be with us by now, yet, they still remain as far off as ever, as it slowly dawns on software engineers that driving is a hugely complex task and we humans are not quite as dumb as we might appear at times.
In addition to the programming difficulties there are also legislative hurdles to be cleared and what may be of concern to the general public is that it is the industry itself which appears to be having a huge influence on framing the law.
When questioned on this, the company replied that, of course creating the legislation should involve all those concerned, yet the suspicion remains that the innocent enthusiasm for autonomy might override the detailed scrutiny of possible effects, a mindset which plagues the machinery industry as a whole.
Here to stay
Claas is a company that is part and parcel of the German industrial complex. It has a philosophy of quality engineering and design that has ensured growth since its foundation in 1913.
Yet there is another element to this success which is its status as a family-owned and controlled company, one of many in the continental farm machinery industry.
Not having a mass of shareholders to feed endless dividends to allows these businesses to dig their heels in during the tougher times and make long-term investments which look far into the future whatever the economic climate, and this is precisely what Claas is doing.
