German original equipment manufacturer (OEM) Claas has manufactured machinery in North America for more than 25 years – first through a partnership with Caterpillar and since 2002 on its own. The OEM is reinforcing its innovation capacity in the region with the opening of an R&D center at the company’s Omaha, Nebraska facility.
Last August, Claas broke ground on the 44,800-square-foot facility that serves as the OEM’s hub for North American testing, which will be a crucial part of its global innovation network. In addition to its Germany headquarters, the OEM also operates facilities in China, France, and Hungary.
At the R&D center, engineers will test and evaluate Claas equipment for the North American market and provide market and performance data to their German counterparts, Matthias Ristow, managing director business administration at Claas, told AgNavigator.
The Omaha facility includes two floors of office space and digital and physical measures to protect intellectual property, according to a press release. Claas celebrated the grand opening of the facility during a ribbon-cutting ceremony on Oct. 8.
“The advantage of having a local R&D team is it’s staffed by local people who know the local markets, who know the local technologies, the local harvesting needs, and their job is to communicate that knowledge to their colleagues in Germany. And when new products are prepared for the future markets, then it’s their job to communicate this and make sure that those needs of the local farmers can be found in the new product set,” he elaborated.
How trade dynamics are shaping the OEM market
Like many large ag machinery companies, Claas had to navigate the Trump administration’s trade and tariff policy, which impacted the various parts that Claas would import from Germany and other countries. The broader OEM market is trying to find its ways back to growth as trade dynamics and farm economic challenges cut into volume sales.
During the trade uncertainty last year, Claas moved some of its combine production back to Germany. The OEM worked with the Omaha businesses and the community to ensure employees had jobs during the production shift, and the OEM brought those workers back as production ramped up, Ristow noted.
“For a company like us that is importing many parts from overseas, tariffs are an issue ─ no question. And we closely monitored that topic together with our colleagues in Germany. [We] formed our own tariff task force and exchanged information, making sure that our folks at corporate are well informed about what’s going on here,” Ristow said.
The tariff task force is still in an effect today and is keeping an eye on trade developments between the U.S. and Canada. In late August, the Trump administration levied 50% tariffs on a variety of Canadian goods, including on machines and automobiles, following a collapse in trade negotiations,.
“Canada is a big market for us. I don’t think that the discussions are totally over with the Canadian government and the U.S. government. So, we have to closely monitor that and see what’s coming in the future,” Ristow elaborated.
‘Here to stay,’ Claas charts growth in North American market
While watching trade development, Claas still sees growth potential in the North American market and has been making investments to manufacture part locally, including grain tanks, Ristow said. An estimated 40% of the components of its Lexion combines are made in America.
Last month at the Farm Progress Show, Claas revealed the Arion 6 and Axion 8 and 9 tractors, which spanned 165-450 horsepower range and were designed for mixed farming use all the way up to large row crop production.
“We want to grow. That means we also need to grow in North America, and for that we need to invest and prepare us for the future. And the group executive board has done that, so Class is ready. We are here to stay,” he added.