At the beginning of the quarter, John Deere said it will spend approximately $29.8 million to expand its Louisiana plant, shifting some of its cotton harvester production from China back to the US. It is estimated that this will create 70 direct jobs.
The average annual salary expected, according to Louisiana Economic Development, is $47,472. The Louisiana factory currently has 284 employees. The shift is also projected to create 110 more indirect jobs.
Deere & Company said it will develop the new production line and install upgrades through the rest of the plant. This will precede the transition of building a new model of harvester to replace the ones being built in China.
The factory Manager, Mike Duplantis, stated, “The new cotton harvesters present a huge opportunity for John Deere Thibodaux to deliver innovative and technologically advanced solutions to our customers, which will increase their productivity and profitability.”
John Deere estimates that production of the new cotton harvesters will begin within the next two
years and the plant will reach full production capacity nearer to 2025.
Louisiana has also offered John Deere an incentive package grant of up to $1 Million, in an effort to secure the transition. The grant is a performance-based retention and modernization grant and tied into Louisiana’s nationally acclaimed training and workforce development program. John Deere is also expected to benefit from the Industrial Tax Exemption and Enterprise Zone programs offered.
“This investment by Deere & Company demonstrates not only the strength of Louisiana’s manufacturing sector, but the resilience and recovery of the Bayou Region,” Louisiana Gov. John Bel Edwards stated.
Deere’s stock has risen 2% this year, in contrast to a 26% decline for the S&P 500. Deere’s net income also rose 13% from just a year earlier, climbing to $1.88 billion in fiscal Q3, as overall gross revenue climbed 22% to $14.1 billion. Many traders seem to value long-term investment in the John Deere Company and rate the company overall with a buy rating for investors.
