The combined power: John Deere and The Wirtgen Group

The Wirtgen Group signed a definitive agreement with Deere & Company to have Deere acquire the Wirtgen Group in 2017.

The Wirtgen Group officially became part of John Deere’s Construction and Forestry division in 2017. Four years on, Roads & Infrastructure looks at what the merger means for Wirtgen’s existing and new customers in Australia.

December 2017 marked a new chapter in the Wirtgen Group’s growth journey as the company officially become part of John Deere Group’s Construction and Forestry (C&F) division and former managing partners Jürgen Wirtgen and Stefan Wirtgen handed over the operative management of the Wirtgen Group to the new CEO, Domenic G. Ruccolo.

Nearly four years later, Wirtgen Australia Managing Director Stuart Torpy says the acquisition has helped the Wirtgen Group continue to deliver class leading equipment – but the real benefits are yet to come.

Long cherished by civil contractors and construction companies in Australia for its reliable range of Wirtgen, Vögele, Hamm and Kleemann brand machinery, Wirtgen Australia maintains its pre-existing sales and services structure, but with potential for a broader Australia- and New Zealand-wide presence through the John Deere dealership network.

In May 2019, John Deere Group Australia appointed two new dealers for its C&F business – AFGRI Equipment in Western Australia and RDO Equipment in all other states and territories. Both businesses already held dealerships for John Deere’s Agriculture and Turf (A&T) side of the business and as such, had strong existing customer relationships.

A world of opportunities

Torpy says the merger has opened new doors to Wirtgen’s existing and new customers.

“John Deere’s purchase of the Wirtgen Group unlocks many opportunities for the expanded group, one of which is leveraging existing customer relationships to streamline a range of areas such as equipment finance, servicing and parts,” he says.

“With the local presence that John Deere’s C&F dealers offer, the future is bright if you look to the potential for expanded access to service and parts for customers around Australia. Between Wirtgen and John Deere, there are now over 100 service and parts locations across Australia.”

From a sales perspective, Torpy says contractors often like to mix-and-match Wirtgen and John Deere equipment to purchase a complete set for their specific applications.

“For example, collectively we can offer Hamm rollers with John Deere graders, or Kleemann crushers with John Deere loaders and excavators. And they’re just a few of many potential examples.”

And while the Wirtgen Group did not previously own an in-house finance product, with John Deere’s finance arm – John Deere Financial, the group can now provide some basic financing options on the Wirtgen Group equipment, while also liaising internally with John Deere Financial to work out the best finance solutions for customers.

“Ultimately, customers will be able to have one provider of finance [John Deere Financial], the closest possible access to parts and service technicians and greater buying power and pricing,” Torpy says.

What it means for Patten Pavement Services

John Patten regards himself as one of the first people in Australia to have sat behind a Wirtgen profiler.

“I feel like a dinosaur,” he jokes, recalling how he has worked with every generation of the Wirtgen profiler launched in Australia, seeing the machines’ evolution over time.

John Patten, Director of Patten Pavement Services, regards himself as one of the first people in Australia to have sat behind a Wirtgen profiler.

“It was around 1987 or 1988 and I was working as supervisor with Blacktop Profiling when they bought the very first front-loading Wirtgen profiler in Australia,” says Patten, now the Director of Patten Pavement Services.

Since launching his own civil contracting and road construction company – initially as a partner with Melbourne Road Profiling in 1998 and later as Patten Pavement Services in 2003, Patten says he has never bought a profiler other than a Wirtgen one.

Today, Patten Pavement Services has a team of over 65 professional operators and provides Profiling, road construction, crushing, civil, traffic management and maintenance services to clients such as VicRoads, Fulton Hogan, Downer, John Holland/CPB, BMD, Decmil, Transurban, as well as many local Victorian councils.

As a preferred contractor on major federal and local government projects throughout Victoria, Patten Pavement Services is heavily involved in freeway and airport runway projects – including on Cairns Airport where the team used their 3.8-metre drum Wirtgen profiler to do the job.

“We specifically bought the Wirtgen profiler for these projects. With a 3.8-metre-wide drum and a 2.5-metre wide drum, it is the largest and the only one of its kind available in Australia,” says Patten.

Patten Pavement Services has completed airport runway projects at Melbourne, Adelaide, Launceston, Devonport, Darwin, Amberley RAAF, Woomera RAAF, Proserpine, Roma, Gold Coast, Rockhampton, Moranbah and Cairns airports, to name some.

The list of freeway projects the team are currently on or have completed is just as long, including projects such as the Westgate tunnel, Monash freeway upgrades (MFU1 and MFU2), Mordialloc bypass, Drysdale bypass, City Link/Tulla freeway upgrade and M80 upgrades.

Patten Pavement Services recently expanded its crushing business with new Wirtgen and John Deere equipment.

The past two years have been particularly busy years for the company in terms of tier-one project delivery and expanding the fleet. Patten estimates they have spent upwards of $4 million on new equipment purchases through John Deere Group. This includes buying new Wirtgen Profilers, Kleemann crushers, screens and stackers to expand the company’s crushing business, and backing this up with new John Deere wheel loaders and excavators.

Patten is now negotiating with Wirtgen and John Deere to open a single line of credit with the John Deere Group to make it easier for him to finance new equipment purchases going forward.

“It’s just a lot easier to deal with one company,” he says. “With the current climate in the civil industry, we are just so busy, and we are growing all the time. So, as our business grows and we need more gear, it will be a lot simpler to have a single line of credit with the John Deere Financial to allow us to buy all the new gear easily.”

He is also pleased with the service and backup.

“In addition to our profilers, our Vögele pavers, Hamm rollers and Kleemann crushers are very reliable, and so are the service and backup. Wirtgen has always been very good with spare parts. All of our spare parts come either from Wirtgen Sydney or Wirtgen Melbourne. We purchase the John Deere spare parts from John Deere dealers, and they also come and service our equipment on site.”

A unified approach

Torpy is confident that the unified approach that both John Deere and the Wirtgen Group share towards their customers will result in great benefits for all.

“One of the reasons the Wirtgen brothers sold to John Deere was that they had the same operating philosophy. So culturally, there were no big changes in the way we deal with customers. And that’s critical. Too often you see acquisitions result in massive customer facing changes and whilst some of those may be for the better, change at the best of times needs to be closely managed.

“But customers can also see the potential coming down the road with a unified approach across Wirtgen and John Deere. The potential benefits are immense, and to be honest, it can’t happen soon enough.”

One of those big changes, Torpy hints, is to do with development of common parts to help increase the uptake of John Deere parts into the Wirtgen Group machines.

“This will mean wider common parts availability across Wirtgen Group and John Deere’s C&F and A&T divisions. Having common parts and components will also help expand the service capability of the entire network. For customers working in far flung places, being able to get parts and/or service for Wirtgen Group or John Deere C&F products will be significantly easier,” Torpy says.

“Arguably, it will be Australia’s biggest single original equipment manufacturer (OEM) network.”

With so much happening behind the scenes between the John Deere Group and the Wirtgen Group in Australia to streamline financing, servicing and parts delivery, Torpy says “doing things right” is the key priority.

“Our customers are trying to hurry us up. But critically, we want to do it right, and that’s not an overnight task. Rest assured, we’ve started the ball rolling and we are out of the starting blocks. A bit further down the road, everyone will get a better feel for how big the potential is,” he says.

“Looking forward, I don’t think anyone understands how good this can be for everyone involved – employees, customers, operators, you name it, someone will get something positive out of Wirtgen Group being part of John Deere.”

This article was originally published in the September edition of our magazine. To read the magazine, click here.