The United Auto Workers’ rejection of John Deere’s proposed contract extension underscores the divide between workers pointing to the company’s financial performance as evidence they deserve a stronger voice in the contract and Deere warning that soft agricultural equipment demand and an uncertain farm economy continue to pressure the business. While the UAW says Deere’s financial results and employment outlook support its position, the company says it has faced inconsistent financial performance in recent years and remains uncertain when a sustained turnaround will come.
“While John Deere continues to outsource jobs, 1,600 workers are still laid off. Our members rejected Deere’s offer to extend their contract because they know their worth and what they deserve,” says UAW President Shawn Fain. “The company failed to make an offer that addressed the issues weighing on the minds of our members, especially job security. We’ll see Deere at the table in 2027.”
Meanwhile, Deere & Company says it’s disappointed by the outcome of Sunday’s vote. The current agreement remains in place through October 2027. Deere & Company says they will return to the negotiating table with the UAW when the agreement is set to end.
The company says the offer “significantly” enhanced wages, benefits and protections, though the UAW made a counteroffer that exceeded Deere’s proposal by approximately half a billion dollars. The two-year labor extension would extend the contract to 2029. Deere & Company is also offering a 4% wage increase this year and next year, along with some bonuses. The company added that it has faced financial inconsistency over the past few years and is uncertain when and if there will be a turnaround.
“We proposed the extension because we believe added stability and certainty would benefit our employees, customers, and business in a challenging environment,” says Deere & Company in a statement shared with the Farm Journal. “Those market realities have not changed. Demand remains well below 2021 levels, approximately 1,200 production employees remain on layoff, competition continues to intensify, and the outlook for a significant recovery remains uncertain.”
The Financial Divide
The rejection highlights a fundamental disagreement over how Deere’s financial performance should translate to worker compensation.
Deere & Company reported a third-quarter net income of $1.379 billion for 2026, an increase when compared to the $1.289 billion it reported during the same quarter in 2025. The third quarter also saw worldwide net sales and revenues increase by 5% to $12.608 billion and the first nine months rose by 7% to $35.589 billion.
“We believe 2026 is the bottom of the ag equipment cycle,” says Deanna Kovar, president of the worldwide agriculture & turf division. “We wholeheartedly believe that we’re continuing to see signs that would tell us that after three years of double-digit declines in North America of equipment and technology purchases that 2026 is the bottom.”
However, net income is down year over year. Deere & Company reported $3.808 billion during the first nine months of the year compared to last year’s $3.962 billion.
According to John Deere, it’s forecasting 2026 net income to range between $4.75 billion and $5.00 billion. This would be a slight decrease compared to fiscal year 2025, when net income attributable to Deere & Company was $5.027 billion.
UAW: Workers Want a Share
The UAW, however, sees the situation differently. Union leaders point to a nearly $5 billion profit in 2025 for Deere & Company, while expecting to make another $4.5-$5 billion this year. They also share that Deere spent $1.1 billion buying back its own stock and paid shareholders $1.7 billion in dividends, with another $7.9 billion set aside for future stock. The UAW adds that CEO John May received $27.9 million in total compensation in 2025.
“Our members see billions going to shareholders through dividends and stock buybacks,” says UAW Vice President Laura Dickerson, the agricultural implement department director. “While the workers whose skill and labor make those profits possible are asked to accept less. Our members know their value and said no to their offer.”
The July Ag Equipment Manufacturers flash report shows tractor sales year to date are down 13.1%. Four-wheel-drive units are 27% lower and combine sales are down 10.2% on the year.
Previous Strike Looms Large
The last time John Deere and the UAW met at the negotiating table, it led to a month-long strike. More than 10,000 John Deere workers took to the picket lines before finally seeing 61% approval of a six-year deal.
At the time, that six-year deal included:
- $8,500 signing bonus
- 20% increase in wages over the lifetime of the contract with 10% in the initial year
- Return of cost-of-living adjustments
- Enhanced retirement options
- Enhanced CIPP performance benefits
Now that the agreement has been rejected by the UAW, both sides will return to negotiations in October of next year. Deere says they are continuing to evaluate, compete, and prepare for the future. Operational challenges and competitive pressures will continue to help shape their decisions.
“Our responsibility remains clear: to deliver for customers, improve our performance, and strengthen the company for the future,” says Deere.
