John Deere is the kind of homegrown, domestic manufacturer President Donald Trump claims to support, yet his tariffs and hostility toward China are threatening its bottom line.
On the company’s most recent earnings call, investor relations director Josh Beale said there were “pockets of optimism” across John Deere’s business, but added customers may be feeling the sting of tariffs and instability.
“Given challenging industry fundamentals and evolving global trade environment and ever-changing interest rate expectations, our customers are operating in increasingly dynamic markets, which naturally drives caution as they consider capital purchases,” Beale said.
John Deere’s customers, apart from the confusion of tariffs, are also facing headwinds from an economic battle with China. In response to Trump’s tariff escalations, the world’s second-biggest economy retaliated with tariffs on U.S. soybeans, of which last year it imported $13 billion—or about equal to the market cap of John Deere competitor Kubota. Soybean imports to China are down by 51% this year, and the country hasn’t made any advanced soybean purchases for the upcoming harvest, the NYT reported.
John Deere did not immediately respond to Fortune‘s request for comment.
Because of its robust domestic manufacturing, the company may also be more immune to tariffs on foreign imports than competitors Kubota, Fendt, and Mahindra, which manufacture more of their products internationally.
