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Mass Layoffs and Export Decline Reinforce the Crisis in the Agricultural Machinery Sector in Rio Grande do Sul, with Direct Impact on Horizontina, a Municipality Highly Dependent on John Deere for Its Economy.
John Deere confirmed the layoff of 150 employees at the Horizontina (RS) factory this Wednesday (17), justifying the adjustment as a response to the market contraction and the drop in agricultural machinery production.
The unit is one of the main employers in the municipality and a symbol of the equipment chain in the state. According to the company, the goal is to “adapt the production volume to the current market demand”.
In a statement sent to the press, the manufacturer indicated that the decision arises from the recent scenario of slower sales in the machinery segment, which puts pressure on inventories and assembly lines.
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The move was the subject of negotiation with the Horizontina and Region Metalworkers Union.
According to information published this Thursday (18) by the Zero Hora portal, the company considered 200 layoffs, but reduced the number to 150 after discussions with the union.
The cut is surprising because, at the beginning of the year, the factory had hired about 200 new employees to meet a peak in demand.
History of Layoffs at the Horizontina Factory
The Horizontina unit had been operating with workforce adjustments since 2024.
In that year, the company laid off 150 workers after a layoff period, ending contracts at the conclusion of the temporary program.
The measure was attributed to the re-adjustment of the production plan for the following fiscal year.
Months prior, in March 2024, the company had granted collective vacations to 1,100 employees due to the sales decline, preserving some income with supplements provided in the agreement.
This measure already indicated a slowdown in the order book and the need to adjust shifts and lines.
The Weight of John Deere on the Economy of Horizontina
Horizontina has 18,851 inhabitants, according to the 2022 IBGE Census, and concentrates a significant portion of its activity around the agricultural machinery industry.
The importance of the plant is reflected in foreign trade numbers: in 2024, the municipality exported over US$ 104.7 million, primarily in agricultural machinery.
The amount was 37% lower than in 2023, reflecting the sector’s slowdown.
In addition to the direct impact on jobs, the reduction in manufacturing pace tends to affect the supply chain and local services.
The union assesses that some of the laid-off workers may be absorbed by other metalworking companies in the region, but expresses concern about the combination of recent years of drought and producers’ indebtedness.
These factors have hit the demand for machinery and delayed fleet renewal.
Other Layoffs in the Vehicles and Agricultural Machinery Sector
The downturn is not isolated.
In January 2025, AGCO, a manufacturer of harvesters with a unit in Santa Rosa, laid off 51 employees — about 10% of the local workforce — in an adjustment also motivated by lower demand.
The company had already resorted to layoffs in 2024 before the dismissals.
In the automotive sector, General Motors (GM) in Gravataí implemented a two-month layoff starting on April 22, 2025.
The union estimated that between 700 and 1,000 workers were directly affected at the automaker and among suppliers.
Local reports counted, in total, approximately 1,400 employees with contracts temporarily suspended, maintaining only part of the shift and maintenance.
The measure was also justified as an adjustment to demand.
Causes of the Contraction and Signs from Agribusiness
The recent cycle of agribusiness in the state helps explain the slowdown.
The combination of less favorable prices, irregular harvests, and high financial costs restricted investments from rural producers.
This scenario reduced demand for higher-value machinery.
Meanwhile, the industry itself had been reorganizing since 2024, with multiple programs of collective vacations and temporary contract suspensions to avoid inventory build-up.
In this context, John Deere reported that it will prioritize the internal relocation of part of the workforce and the fulfillment of legal severance pay to those laid off.
The union continues to provide legal assistance and monitor placements at neighboring companies.
In a statement, the entity reaffirmed that it will continue to monitor market conditions and the production status at the unit.
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