Claas Continues to Pivot in US Market

HANOVER, Germany (DTN) -- Claas has spent much of the last year trying to adapt to the aggressively changing international trade landscape and the tariffs established by the United States and, in turn, its trading partners.

Showing off its latest equipment earlier this month at the Agritechnica machinery show in Hanover, Germany, the company made clear it was still doing some adapting, including shifting some work away from its sole American manufacturing plant in Omaha, Nebraska.

"It's an evolving situation, for sure," said John Schofield, Claas's North American marketing coordinator.

Anticipating the tariffs that would come, Claas last spring tried to get in front of the situation in North America by pushing its Omaha plant to produce extra of the Lexion combines, even pushing its Nebraska workforce into overtime to do it. The goal was to oversupply its Canadian dealerships before tariffs went into effect between the United States and Canada.

The fear was any Claas equipment built in the United States and shipped elsewhere would stand to be hit twice by tariffs. Between 60% and 70% of the components of a Lexion combine built in Omaha are sourced from outside the United States, meaning all that hardware would be subject to tariffs, including a 50% tariff on steel.

Then, once the United States established tariffs on Canada, the reciprocal Canadian tariffs on U.S. goods meant anything shipping north from the United States would be dinged again.

Those combines built in the spring in Omaha lasted through the fall harvest in Canada, plus a little extra. But to provide an answer going forward, Claas has opted to fill orders from Canada with its factories in Germany rather than Omaha.

"The combines made for Canada, most of them will be made in Germany and shipped directly to Canada instead of out of our Omaha plant," Schofield said. "Some of the production will be moved to Germany just because we incur a tariff to move parts into the United States, and then because it's moving from the U.S. to Canada, which has a reciprocal tariff. It hits that machine again, so temporarily, we'll be changing that."

Shipping straight to Canada comes with some minor complications, as there are subtle design differences between the North American and European versions of the combines, largely consisting of differences in warning labels, danger signs and hook-ups.

Schofield said the Omaha factory has reduced its production but that there have been no layoffs and there are no plans for any.

If tariffs remain in place and at the same rates, headaches won't likely end soon or easily for European manufacturers looking to move their machines to the United States.

Much of the ag equipment Claas debuted at Agritechnica is meant to have a future in the American market, especially the large new Jaguar 1000-series forage harvester.

That machine was announced late in the summer but shown off to the public for the first time at Agritechnica in Germany. It's the next line in the company's top line of self-propelled forage harvesters, and more of a complete redesign than an upgrade, with nearly 90% new parts throughout.

But while it will be sold and used in other countries in addition to the U.S., it was built with the American market front of mind.

Much of the machine was designed by Claas's Omaha-based research and development team, and to show off the Jaguar's capabilities, the company chose a farm in West Texas. There, in a 500-acre field near Dalhart, Texas, a custom harvester pushed the pace for 12 consecutive hours to set a new Guinness Book of World Records mark in wheatlage harvesting.

The new Jaguar's design is a part of a larger effort Claas has made to bring some of its engineering and design to the United States. It's committed enough to the initiative that last summer it announced an expansion of its Omaha facility, including a new research and development center. Previously, some of that work was done in Omaha but off-site.

Tariffs and politics haven't changed any of those plans, and earth-moving equipment was actively preparing the site for construction earlier this month.

"The first big (machine designed in the U.S.) was the Xerion 12 series tractor, which, you see on a lot of the big, big farms, especially in Western Canada, where you have 10,000-acre farms," Schofield said. "Then, the Jaguar 1000 was another where the vast majority of the R&D was done here, where you can have the most takers of that big, big forage harvester in the U.S. The U.S. is the biggest market for the forage harvesters. We surpassed Germany for forage harvester sales about three or four years ago. But the really big machines, the top, high-end, 'I need more horsepower,' that was all being driven by the U.S. custom harvesters."

The 12-series Xerion tractor is built in Europe, while the new Jaguar is coming out of the same Harsewinkel, Germany, factory as the Canada-bound Lexion combines.

Another big debut for Claas at the Agritechnica show was a refreshed line of tractors. The Axion 9, 8 and 6 series are successors for the Axion 900, 800 and 600 series. They're only released in the European market for the moment but should be on track for an American unveiling, perhaps as soon as the latter half of 2026.

Joel Reichenberger can be reached at Joel.Reichenberger@dtn.com

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