John Deere has entered into a supplier agreement with Wacker Neuson that will see the German equipment maker build small excavators for Deere.
Following the agreement, Wacker Neuson will build Deere badged compact excavator models ranging from 1.7 to 7.5 tonnes.
Deere says these models will be specifically designed and manufactured to meet the needs of buyers in the growing Asia-Pacific market.
Deere says that rough terrain work for excavators has grown 55% in China in the past year alone due to more demand for landscape works and the trend to replace manual labour with equipment.
Deere will take advantage of the current market opportunity with models manufactured at the Wacker Neuson factory in Pinghu, China, available for quick delivery.
As such, these machines will initially be offered in China, Southeast Asia and Oceania, the region that includes Australia and New Zealand.
There are no plans to send these machines to the northern hemisphere due to a Deere-Hitachi joint venture.
But Deere iterated if Wacker made models find success in the Pacific, other markets may be considered.
The machines are expected to launch mid 2019 and will be sold and serviced through Deere’s dealer network.
“In partnering with Wacker Neuson, John Deere is leveraging the experience and success of their innovative and strongly customer-focused products to help us further develop our position in the Asia-Pacific region,” says David Thorne, senior vice president for sales at marketing at John Deere Construction & Forestry.
Deere says the goal of the alliance is “long-term collaboration in key growth markets.” The initial agreement will run for five years and can be extended in five-year increments.
The deal comes two years after Caterpillar ended a similar six-year partnership with Wacker when between 2010 and 2016, Wacker Neuson built Caterpillar mini excavators.
Cat opted to bring manufacturing of these machines in-house after seeing increased demand for this market segment.