Deere's Stock Climbs Amidst Legal Storm: FTC Lawsuit Challenges Repair Monopoly
1min read Recent developments regarding Deere & Company have captured significant attention. The American agricultural machinery giant saw its stock rise by 3.72% on January 17, marking a two-day increase of 6.19%. This uptick brought the share price to unprecedented highs since December 2024, but financial performance figures tell a more complex story. As of October 27, 2024, Deere reported total revenues of $51.716 billion, a year-over-year decline of 15.57%, with net income attributable to the parent company falling by 30.16% to $7.1 billion.
The company was recently brought into the spotlight by the U.S. Federal Trade Commission (FTC) and the attorneys general of Illinois and Minnesota. They have jointly filed a lawsuit against Deere, accusing the company of monopolistic practices regarding the repair of its equipment. The core of the contention lies in Deere's alleged restriction of farmers' rights to repair their machinery, driven by the company's intricate and essential software systems embedded in their equipment. This software, crucial for repairs, is fully accessible only to authorized dealers, via the complete Service ADVISOR tool, leaving other consumers with a limited version.
Unauthorized third-party repair services are further disadvantaged as Deere does not provide them access to full software specifications needed to execute comprehensive repairs. This has compelled customers to rely predominantly on Deere's authorized dealers, who often utilize expensive, branded parts rather than more economical generic alternatives. These practices have not only inflated repair costs but have allegedly ensured that both Deere and its dealer network continue to reap substantial profits.
The implications of this lawsuit may reverberate throughout the agricultural industry, potentially redefining the contentious issue of repair rights. As Deere plans to announce its first quarter financial results for the 2025 fiscal year on February 13, shareholders and industry stakeholders will be closely monitoring how these legal proceedings and their financial outcomes unfold.
