John Deere has a secret side that makes lots of money

Mark Garrison Feb 19, 2016
HTML EMBED:
COPY
John Deere has a large finance wing that brought in $2.8 billion last year.  Scott Olson/Getty Images

John Deere has a secret side that makes lots of money

Mark Garrison Feb 19, 2016
John Deere has a large finance wing that brought in $2.8 billion last year.  Scott Olson/Getty Images
HTML EMBED:
COPY

Say John Deere and people think of farming, construction, landscaping and the heavy equipment the company makes for those industries. Few outside of Deere’s world see it as a financial services outfit. But Deere has a large and profitable finance wing, which brought in $2.8 billion last year, providing loans and leases for its iconic green machines, which can cost hundreds of thousands of dollars a piece.

With commodity prices in the dirt, times are tough for farmers, which means they’re not spending as much on new equipment. Deere’s profits took a sharp dive in 2015.

Now that Deere’s main business of selling equipment is struggling along with its farmer customers, its finance arm provides a much larger share of profits than in the past — a third last year. And with more tough times for agriculture in the forecast, Deere may have to rely on its lesser-known finance side even more in the months ahead.

As a nonprofit news organization, our future depends on listeners like you who believe in the power of public service journalism.

Your investment in Marketplace helps us remain paywall-free and ensures everyone has access to trustworthy, unbiased news and information, regardless of their ability to pay.

Donate today — in any amount — to become a Marketplace Investor. Now more than ever, your commitment makes a difference.