Lincoln International’s Global Industrials Group shares insights into the biggest agricultural equipment industry trends to watch after Agritechnica 2025.

1

Global tensions have continued to drive headwinds against agricultural equipment in 2025.  Recent announcements from AGCO, CNH Industrial and others suggest North American volumes are expected to decline by 25-35% in 2025, while European volumes held up better with single digit declines. This is potentially due to the large number of family-owned businesses, which have performed relatively better across global markets. We heard numerous viewpoints on the challenge of maintaining order books and supply chains with such a decline in machinery sales. Volatile tariff declarations from the U.S. have caused further issues for global manufacturers just in calculating costs, as the metal content of machines is now taxed at 50% in addition to the general 15% tax. Across the world, the Russian market remains mostly closed for Western producers—even those that have retained their Russian subsidiaries. Chinese suppliers are filling the resulting gap, which is a developing challenge in other markets. Interestingly, most manufacturers seem still to have a healthy business in Ukraine despite the security situation.

Given the cyclical nature of the Ag Machinery sector, however, Lincoln believes that the industry has officially reached the lowest point in the investment and demand cycle. Players should expect that after some fortitude and longevity, relief should come in 2026 and extend into 2027.

2

All Ag Machinery players are showing advances in new product development, from majors and mid-cap firms to emerging component and technology companies (e.g. sensors, drones, software). The most promising solutions in development are targeting smart farming, productivity gains and savings in labor, inputs and fuel.

Autonomous and battery-driven technologies are popular and attracting investor attention, but tractors above 150 horsepower are not easily electrified. Players like NEXAT, which streamlines crop production workflows into a unified and modular system, are capturing high levels of attention from both investors and strategics.  Agritechnica remains the unique opportunity for machinery companies to showcase their latest innovations to aid farmers and other end users.

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North America’s high level of used inventory remains a serious challenge within the supply chain, but Europe is seeing improved levels. Used technology faces obsoletion as dealers promote new, technology-enabled equipment, further worsening used inventory retention. If used inventory remains at the current level, trade-ins and leasing deals may be harder to manage, potentially causing some dealers to even exit the market.

4

New products are generating interest in existing AgTech markets but also in new geographies across Latin America and Asia. Access to (and adoption of) technology-enabled equipment has historically separated some manufacturers into the “haves and have nots,” but this trend could be reversing. While all major existing markets have seen high level of local investments in new technology, companies like AGCO, Deere and Claas have invested capital more intentionally to efficiently capture opportunities in AgTech innovation. These focused investments could be difficult for midcap and private players to keep pace with on their equipment.

Despite its wide geographic reach and high levels of economic production, Ag Machinery remains a small industry at its core. Manufacturers are preparing to best position themselves for the next upturn, even if that means finding a new partner or sponsor. The European market remains much less consolidated than in the U.S., particularly for implement, component and related technology suppliers, and there may be upcoming opportunities in Europe accordingly.

Looking Ahead with Lincoln

Demand for technological innovation and increased agricultural efficiencies will continue driving investment and interest in the Ag Machinery market and its suppliers for the quarters to come. Lincoln’s bankers are uniquely positioned to help clients navigate the evolving sector and macroeconomic landscapes, leveraging deep industry expertise and outstanding executional capabilities. Reach out to discuss your positioning in 2026 and beyond.