Resilient Investment Plans
Despite the looming threat of tariffs by U.S. president-elect Donald Trump, John Deere remains steadfast in its expansion strategy. The company has recently reaffirmed its commitment to invest $55 million in a new manufacturing plant in Mexico. This decision follows Trump’s warning of imposing a 200% tariff on any equipment that the company manufactures in Mexico and sells in the U.S. Gecimar Morini, John Deere’s regional manager for Mexico, Central America, and the Caribbean, declared that the company’s plans are firm “regardless” of potential political shifts.
Strategic Expansion into Construction Equipment
The planned facility marks John Deere’s first venture in Mexico focusing solely on construction equipment, underscoring a strategic pivot towards the construction sector. Slated to begin operations in 2026, the plant will produce mini track loaders and mini wheel loaders primarily for the domestic market. Morini highlighted the company’s aim to deepen its footprint in the agriculture, construction, and infrastructure sectors.
Choosing Nuevo León: A Strategic Locale
Set to be located in Nuevo León, a strategic choice due to its proximity to a dedicated export lane at the Laredo-Colombia International Bridge, the plant benefits from John Deere’s established presence in the region with existing facilities in Ramos Arizpe, Saltillo, Torreón, and Monterrey. This expansion is driven by Mexico’s robust demand for construction equipment—a market where consumption has surged by 76% since 2022, making it Latin America’s second-largest market for John Deere’s construction gear. Morini notes the significant potential in Latin America’s compact equipment segment, which contrasts sharply with more mature markets like the U.S. where annual sales reach approximately 100,000 units.
