Demonstration projects for promotion and development of new equipment
A close friend farms over 10,000 acres of corn in the mid-west. The property is spread out over 3 counties. His operation is a “partnership farm” with John Deere. They use the larger farm operations as demonstration projects for promotion and development of new equipment.
He recently received a phone call from his John Deere representative, and they want the farm to go to electric tractors and combines in 2023. He currently has 5 diesel combines that cost $900,000 each that are traded in every 3 years. Also, over 10 really BIG tractors.
John Deere wants him to go all electric soon.
He said: “Ok, I have some questions. How do I charge these combines when they are 3 counties away from the shop in the middle of a cornfield, in the middle of nowhere?” “How do I run them 24 hours a day for 10 or 12 days straight when the harvest is ready, and the weather is coming in?” “How do I get a 50,000+ lb. combine that takes up the width of an entire road back to the shop 20 miles away when the battery goes dead?”
Response Questions:
- Have you heard of a “partnership farm” before? What benefit(s) does this arrangement provide to the farmer? What benefit(s) does this arrangement provide to John Deere?
- What things has John Deere failed to consider in this scenario?
- Do you think the John Deere representative was involved in the “push” for this farm to go electric? Why or why not?
- What factors are influencing John Deere to modify their sales strategies? What would happen if John Deere did not modify their sales strategies?