Connectivity Shines For John Deere

Deere & Compan DE y CEO John May attributes the firms better-than-expected Q2 2020 financial performance in part to the company’s investments in connectivity and precision agriculture.

On Friday’s Q2 earnings call, May reported that Deere has seen, “triple digit growth in adoption of connected services, like Remote Display Access, Service ADVISOR Remote and Expert Alerts.”

May went on to expand on the practical impact of data connectivity and automation in Deere’s fleet of agriculture machines. “Not only have these tools allowed customers to practice social distancing guidelines, they’ve also decreased downtime and cost of their operations.”

Deere reported year-over-year declines in net sales and net income of 18% and 41%, respectively. Those results exceed the Wall Street expectations for Q2, during which many companies experienced significant declines related to the COVID-19 pandemic.

Nancy Post, Director of John Deere’s Intelligent Solutions Group, recently shared on The Autonocast that John Deere first released its AutoTrac guidance system on farm equipment 20 years ago. Since 2011, connectivity has come standard on all of Deere’s large agricultural equipment.

This has led to an installed base of over 200,000 machines. In Brazil alone, Deere has opened up 30 customer data operations centers to monitor equipment and support farmers remotely.

Whereas Deere’s Q1 2020 earnings call highlighted the value of precision agriculture, this quarter the emphasis shifted subtly to connectivity. Precision agriculture improves crop yields, but connectivity allows both farmers and Deere to manage operations remotely, without having to travel or risk COVID-19 exposure.

Cory Reed, Deere’s President of Agriculture and Turf, expanded on the importance of these capabilities in the current environment.

“We had a customer who had hooked this planter up wrong, had individual hydraulic down force on his planter. We’re now getting digital connections between those planters back to our dealers who are able to diagnose those machines down to the individual row unit without having to be in the field looking at the problem.”

On The Autonocast, Post shared that Deere has an internal goal for complete autonomy, with no operator required on the machine. “We have target-not a target that we’re sharing publicly. And it’s not long into the future.”

May emphasized the importance of continuing to invest in technology, in spite of the economic downturn.

“In light of the current circumstances, we see it as an obligation to continue investing in precision technologies that support customers and keep them running.”

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