John Deere 2009 Annual Report Download - page 4

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Credit Providing Solid Support
Making a further contribution to last year’s performance was
John Deere Credit, which remained profi table and, importantly,
continued providing uninterrupted fi nancing to equipment
customers. This was a major accomplishment in light of the
diffi culty many fi nance companies experienced raising funds
during the year. Even at the depths of the global fi nancial crisis,
our operations enjoyed access to the credit markets on favorable
terms. The enterprise was able to borrow some $9 billion, funding
virtually all upcoming debt maturities in the year ahead. This
success was largely the result of a conservative capital structure
and the credit operation’s long record of low loan losses and high
portfolio quality.
Another signifi cant event in 2009 was the merging of our
agricultural equipment and commercial and consumer equipment
businesses, which offi cially became known as the Worldwide
Agriculture and Turf division at mid-year. The new organization’s
global operating model leverages common processes, standards
and resources. It is expected to deliver annual savings of at least
$50 million. Of equal importance, as a more streamlined and
customer-focused business, A&T should be able to operate with
greater agility and effectiveness.
Committed to Guiding Principles
This is my fi rst message to investors as Deere’s president and
chief executive offi cer. It was my privilege to be elected president
by the Deere board of directors in June then to become the ninth
chief executive offi cer in August. My background includes 34 years
of service in all the company’s major businesses, including my
most recent role as head of the Construction and Forestry
division. As CEO, I will remain fully dedicated to our guiding
principles, stressing the importance of integrity, quality,
commitment and innovation in everything we do. I also plan to
maintain and strengthen an emphasis on the SVA model and
maximizing returns on capital.
No leader can be more effective than those around him or her.
Fortunately, my efforts are receiving expert support and counsel
from a capable team of senior leaders. All share an allegiance to
the company’s values and a passion for serving customers,
employees, investors and other stakeholders at the highest level.
It is appropriate to pay tribute to Bob Lane, my predecessor as
chief executive, who led the company with great distinction over
the last nine years. Bob’s vision and integrity took John Deere to
entirely new levels of performance and of promise. Because of his
leadership, especially his gift for engaging and inspiring talented
employees and leaders, the company is well-positioned to endure
today’s diffi cult economic environment and well-prepared to seize
the powerful long-term trends so important to our future.
Tailwinds Shaping Plans
Today’s global economic slump has done little to calm the
macroeconomic tailwinds that hold such potential. In spite of
recent slowing in population growth, the world still is gaining
about 200,000 people – and new mouths to feed – every day.
That is expected to result in about 3 billion additional people
living on this earth by 2050. Of equal importance, a larger middle
class is leading to new levels of demand for food and for energy,
including biofuels such as ethanol. As a result of growing
Loaded with premium features without a premium
price, the John Deere 3E-series tractors (3038E
shown) feature hydrostatic transmissions and
electro-hydraulically operated independent PTOs, in
simple-to-operate tractors. Other qualities include
higher engine power and greater loader lift capacity.
Part of the company’s largest-ever launch of golf course
equipment, the 7500 E-Cut mower is one of three new
fairway models built on hybrid technology. Machine has
more power but offers quieter operation and improved
fuel economy. Electric-driven cutting units reduce risk of
hydraulic leaks.