CNH ag sales down 16% due to lower industry demand

CNH Industrial has said that lower industry demand has led to a 16% drop in net sales in the second quarter of this year (US$5.49bn in Q2 2024 v US$6.57bn in Q2 2023).

CNH Agriculture (Case IH, New Holland and Steyr) net sales decreased for the quarter by 20% to $3.91bn. This follows a similar pattern to the first three months of this year when CNH’s agricultural net sales were down 14% on the same period in 2023.

The firm has said that was primarily due to lower shipment volumes based on decreased industry demand and dealer inventory requirements across all regions, partially offset by favourable price realisation.

In North America, industry volume was down 11% year on year in the second quarter for tractors under 140hp and was up 2% for tractors over 140hp, while combines were down 5%.

In Europe, Middle East and Africa (EMEA), tractor and combine demand was down 10% and down 36%, respectively. South American tractor demand was down 10% and combine demand was down 26%, continuing the recent negative trend. Asia Pacific tractor demand was up 1% and combine demand was up 4%.

Construction

The company’s construction net sales decreased for the quarter by 16% to $890m, due to lower volumes across all regions driven mainly by lower market demand. However, its gross profit margin was 16.5%, an increase on Q2 2023, due to better purchasing and manufacturing costs.

CNH forecasts that global industry retail sales will continue to be weaker in both the agriculture and construction equipment markets in the second half of 2024.

CNH has said it is forecasting agricultural net sales to be down between 15% and 20% year on year, while it feels construction net sales will be down between 15% and 20%.