U.S. tractor sales have continued their downward trajectory in early 2025, as sluggish commodity prices, high interest rates, and uncertainties surrounding the year ahead weigh heavily on the agricultural sector. January 2025 sales showed a significant 15.8% drop compared to the same period in 2024, with large tractors over 100 horsepower seeing a staggering 26.8% decline. Four-wheel drive tractor sales plummeted by 50% year-over-year, according to data from the Association of Equipment Manufacturers.
The slowdown in tractor sales reflects broader challenges within the agriculture industry. Deere & Company reported a 35% dip in quarterly revenue for the period ending February 13, 2025, falling short of analyst expectations. Reuters attributed this drop to weak farmer incomes, high borrowing costs, and lingering effects from former President Donald Trump’s 25% tariffs on steel and aluminum, which have driven up the cost of industrial metals.
CNH Industrial also anticipates a lower year-over-year sales forecast for 2025 in both its agricultural and industrial sectors. The company projects the industry may begin to stabilize in 2026, marking a potential recovery after a period of contraction.
The downturn in tractor sales is also taking a toll on manufacturing. CNH Industrial America, for example, announced in February 2025 that it would lay off 175 employees at its Benson, Minnesota, facility due to reduced demand, effective April 11.
Despite the economic challenges, Dan Dufner, vice president of large and compact tractors at CNH Industrial, describes the downturn as part of the natural cyclical ebb and flow of the industry. With 30 years of experience in the field, Dufner believes these lean times force manufacturers to focus on their core strengths. He emphasized that farmers do not buy new tractors for the sake of having a new machine—they invest in new equipment to improve their productivity.
“The focus is on getting the job done better,” Dufner said during a panel discussion at the Northern Corn and Soybean Expo in West Fargo, North Dakota, in February 2025.
Dufner also highlighted CNH Industrial’s focus on sustainability, which has earned the company a spot in the top 5% of S&P Global’s 2025 Sustainability Yearbook. Innovations in automation and sensor technology have allowed CNH’s machines to reduce grain loss, fuel consumption, soil compaction, and improve crop residue distribution.
He believes that tough economic times drive innovation, pushing the industry to refine practices that increase both manufacturer and customer productivity. “When commodity prices are down, and discretionary income is tight, people aren’t buying machinery as they usually would,” Dufner noted. “When they do buy, the equipment has to work harder and smarter.”
Looking to the future, Dufner remains optimistic. He sees technological advancements—particularly in machine size optimization and efficiency—as crucial for meeting the evolving needs of farmers. “Farmers are merging and expanding, and to stay productive, we need to focus on economies of scale,” he explained. “This means machines need to go faster, work wider, and be smarter with each pass.”
The COVID-19 pandemic accelerated the adoption of technology across agriculture, and Dufner believes this trend will continue to reshape the industry. As manufacturers seek ways to overcome economic and workforce challenges, autonomy in machinery is gaining traction.
Todd Pringle, advanced engineering manager at John Deere, shared his excitement about the potential for autonomous machinery to help address labor shortages. “Autonomy is not about eliminating the human; it’s about scaling the human,” Pringle explained. “It’s about allowing operators to work more efficiently, anytime and anywhere.”
Pringle noted that the real challenge with autonomous tractors isn’t creating self-driving machines, but rather replicating the many tasks a human operator currently manages while driving. He sees autonomous technology as a potential solution to the workforce gap, helping to ensure the future sustainability of agricultural operations.
Despite current challenges, industry leaders agree that innovation—driven by advances in automation, efficiency, and technology—will be key to overcoming the difficulties faced by the agricultural sector and setting the stage for growth in the coming years.