A leading combine manufacturer with strong ties to Western Canadian farmers has confirmed it will move production of some of its machinery from the United States to Germany to avoid tariff uncertainty.
CLAAS, known for its LEXION combines, has long produced its North American equipment at its Omaha, Nebraska, plant. But beginning with the 2026 model year, CLAAS will assemble all Canada-bound LEXION 8000 Series machines at its Harsewinkel, Germany, facility.
“This production allocation is a strategic response to the current tariff and trade framework — in particular existing U.S. customs duties — helping to keep prices competitive for farmers,” the company said in a statement to CBC News.
CLAAS noted that no layoffs are planned in Nebraska, where the factory will focus on machines for the U.S. market.
Trade experts say the move is less about current Canada–U.S. relations and more about preparing for a potentially contentious renegotiation of the Canada-U.S.-Mexico Agreement (CUSMA). William Huggins, finance professor at McMaster University, said businesses are positioning themselves ahead of possible tariff escalations: “It can get a lot messier and it can get a lot more difficult, economically speaking. We should expect to see businesses behaving cautiously.”
Because Canada has a free trade agreement with the European Union, manufacturing in Germany provides long-term tariff-free certainty. McMaster economist Colin Mang said CLAAS may be the first of many: “You’re going to see more companies over the next few months announce supply chain changes to get ahead of potential tariffs.”
For farmers, the decision could bring financial relief. Jeremy Welter of the Agricultural Producers Association of Saskatchewan estimated new combines can cost more than $1 million, not including additional equipment. He said CLAAS’s shift could mean lower costs for Canadian farmers: “When you’re talking about that much money for a machine you’ll use six or seven weeks a year, it’s a significant investment.”
Experts agree that for global manufacturers, stability in trade policy is a crucial factor. Mang added, “Having certainty in terms of tariff-free access goes a long way to forecasting what their business will look like over the coming decades.”
