NUR ALIA NAJWA BINTI MOHD SAKRI | 2020462342 | BA2324A

FACULTY OF BUSINESS AND MANAGEMENT

BACHELOR OF OFFICE SYSYTEMS AND MANAGEMENT (HONS)

BUSINESS ANALYTICS (MGT555)

ASSIGNMENT 1
COMPANY/MULTINATIONAL COMPANY (CLAAS)

PREPARED FOR:

DR. SHAIFUL AZLAN BIN ABDUL

PREPARED BY:

NAME UiTM NUMBER

NUR ALIA NAJWA BINTI MOHD 2020462342

SAKRI

SUBMISSION DATE:
2 MAY 2022

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No Content Page

1.0 Introduction (Company History)

• The Knotter 3
• 1913 – 1929 4–7
• 1930 – 1945 7 – 11

• 1946 – 1968 11 – 15

• 1969 – 1988 15 – 16

• 1989 - Today 16 – 17

2.0 Product Portfolio 17 - 18

3.0 Capital Market 19

4.0 Sales and Earnings 19 – 20

5.0 Worldwide Growth in Employee Numbers 20

6.0 Strength
• Development and Modernization of Production 20
Sites and Sales Location
• Strong Focus on Research and Development 20 - 21
7.0 Weaknesses 21 – 22
• Slight Decrease in Number of Employees 22
Worldwide
8.0 Employment Opportunities 23

9.0 Conclusions 23

10.0 References 24

11.0 Appendices 25

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1.0 INTRODUCTION (COMPANY HISTORY)

Overview

A passion for agriculture. That are tagline for CLAAS Company. Many companies have a

history but some of them have also made history. CLAAS has helped to define the world of

agriculture. Let’s join them as they delve into the history of the company since its establishment

back in 1913.

The Knotter
The knotter is one of the products CLAAS Company. It means a symbol of better things to
come. What exactly is a knotter? The knotter, as the tying device in the straw binder is known,
may have been inspired by the sewing machine principle. A sewing machine's needle presses into
the fabric and pulls loops through the textiles as they pass by. Similarly, the straw binder's knotter
uses a needle and a knotter hook to loop the binding twine around the bale of straw and then pulls
it tight. If, the binding twine is of consistent thickness, this approach works nicely. The rope splits
and the straw bundles fall apart if their thickness fluctuates. Early in the nineteenth century, the
American corporation McCormick introduced a very effective mechanism to bind straw to the
market, but the binders were only partially successful in continental Europe and were frequently
breaking down. August Claas then created a knotter hook with a limited range of motion in the
jaw. Because of the increased flexibility, binding twine of any thickness or composition could be
produced and, in theory, would always hold.

The twine was of poor quality, particularly in the period of shortages following World War
I. As a result, the CLAAS invention was of huge economic importance in the field of agriculture.
The knotter device was issued with patent No. 372140 in 1921, as the very first patent of Gebr.
Claas. The legendary knotter bill hook with floating jaw was patented in 1923 under No. 414212.
Essentially, the knotter still works in much the same way today, and straw bales all around the
world are still firmly tied with twine. Straw is well worth protecting as a valuable and renewable
resource, and the knotting process maintains the shape and quality of the bales.

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Company History
CLAAS's journey would have taken a totally different path if it hadn't been for the legendary
knotter. Let's look at the CLAAS narrative and see how a little village blacksmith's workshop
turned into one of the world's largest agricultural equipment companies.

1913 – 1929 (It all started with the knot)

The technical reliability of the CLAAS knotter made the straw binder into a real quality
product and resulted in a rapid surge in demand for sturdy and robust straw binders from
Westphalia. The foundations had been laid for the later success of the company.Without the
legendary knotter, the story of CLAAS might have taken a very different course. It all started in
Clarholz-Heerde, a small farming community in eastern Westphalia. When the family business
operated by his father, Franz Claas Senior, got into financial difficulties, in summer 1913, August
Claas, at just 25 years of age, decided to set up a small firm under his own name. The aim of the
venture was to save the family’s assets, which were at risk of going under the auctioneer’s hammer.
On his father’s letterhead, with the “Franz” crossed out and replaced with his “August”, he
respectfully informed the competent authority that “since 8 April 1913, I have been running a
business in my own name. I employ two fitters and one assistant, and manufacture straw binders.
Yours faithfully, August Claas.”
His three brothers, Bernhard, Franz Junior, and Theo Claas were the employees in question.
They officially became partners in the firm six months later, trading as "Gebrüder Claas," or "Claas
Brothers" (although it was not until 1940 that Theo, the youngest of the brothers, gained official
partner status). The brothers had previously obtained some expertise at their father's business
making and repairing straw binders, and they continued this job in the new enterprise. The four
brothers, on the other hand, would not have to wait long to get the firm up and running. The storm
clouds darkened across Europe and the rest of the world in the summer of 1914, and the First
World War broke out. The Claas brothers were drafted into the military, and the newly formed
company had to temporarily suspend operations. During their departure, they had no method of
preventing the family's Heerde property from being auctioned off due to an unpaid farmer's
account of 85 Mark and a 196.30 Mark debt to a joiner. The house and farm were eventually sold
to a coal and timber dealer in Warendorf.

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(CLAAS straw binder from the years around 1900, displayed at the Claas family farm in Heerde.
In his father’s smithy, the young August Claas (left) gained a thorough knowledge of the workings
and technology of a straw binder.)

(Pioneering years in Harsewinkel. On 7 July 1919, the Claas brothers purchased this disused quarry
on Münsterstrasse in Harsewinkel. It was promptly turned into a factory building for producing
agricultural machines.)

Fortunately, all four sons returned home from the war unscathed. By now, the family had
found a new home in the neighbouring village of Harsewinkel. On the outskirts of the village, there
was a disused quarry on an area of 1,500 m² is a perfect site for August and his brothers to start
the firm up again. The brothers purchased the disused building, which had previously been used
to produce chalky sandstone bricks. They paid for the property with the soldier’s pay which they
had saved up, and some loans contracted for the purpose.

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However, they faced many trials and tribulations on the way to setting up a viable working
factory. They had to draw on contacts and acquaintances to acquire the machines they needed:
lathes, drills, and carpenter’s benches. Step by step, the brothers resurrected the straw binder
production operation. As August Claas later recalled: “At first, we couldn’t make any new straw
binders, because, in the immediate post-war period, the materials were simply not available.
Because there was no twine in Germany, we purchased secondhand binders that were lying around
unused. We then refurbished them and resold them." The brothers were able to purchase the lumber
and metal raw materials they so sorely needed, as well as new machinery, with the revenues from
these initial sales of secondhand machines. The abandoned quarry gradually transformed into a
hive of activity and enterprise.
But there was still a difficulty with these straw binders, which was compounded during the
war years by material supply limits. The tying function of both straw binders and mower binders
became progressively unstable as the quality of the twine utilized by the devices deteriorated. This
resulted in a high number of tying failures and machine downtime, which was a major cause of
annoyance for farmers throughout the hectic harvest season. August Claas was prompted to take a
closer look at the knotter technology because of this. Finally, he filed a patent application for his
first invention, a knotting device, in 1921, followed by the pivotal patent for a "upper lip with
restricted pivoting movement" in 1923.
In 1924, the German Agricultural Society (DLG) ran a major series of tests on binder-
mower machines. Nine German manufacturers took part, including CLAAS with its new knotter.
The jury was won over by the technical reliability of the CLAAS knotter. The final report presented
by Prof. Dr. Ing. Gustav Fischer of the Technical University in Berlin at DLG’s autumn congress
in Würzburg included the following words: “The knotter of CLAAS Brothers in Harsewinkel is
superior to all the rest, because it can work with both very thin and very thick binding twine. This
knotter is a technical advance of major economic significance.”Along with its economic benefits
for the farmers using it, the CLAAS knotter had a significant positive impact on the company’s
business success, thanks to the high demand for the ultra-reliable straw binders available from
CLAAS. As the number of straw binders fitted with the CLAAS knotter increased, imports of
straw binders from other countries began to decline, and the company began to gain a significant
market share in those nations as well. The straw binder and knotter became the company's best-
selling product and trademark. In 1930, it sold its 10,000th straw binder. This was the turning point

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for the young company, laying the financial groundwork for development work on the concept
that would forever change the European harvesting landscape.

(The patented knotter became the firm trademark, under which CLAAS became a familiar name
all around the world.)

1930 – 1945 (The Combine Harvester Revolutionizes Harvesting)

(Pioneers of a combine harvester for European conditions: Prof. Karl Vormfelde)

Professor Karl Vormfelde was a trailblazer in the invention of the combine harvester for
use in Europe. In the 1930s, he was the director of the University of Bonn-Institute Poppelsdorf's
for Agricultural Technology. He had noticed the significant cost reductions that farmers were
seeing because of the usage of combine harvesters, particularly in the United States, Canada,
Argentina, and Australia. As a result, the agricultural sectors of those countries had advanced
significantly. They nearly doubled their grain exports from 1913 to 1927, with far-reaching
implications for international grain prices and the farming sector in other countries. "In the postwar
period, we are seeing massive and far-reaching changes in the organization of the agricultural
sector over most of the world." In an essay published in 1931, Vormfelde said, "These regions
have only recently begun to grow, and the scope of their further developments and the
ramifications for farming here in Germany can only be guessed at this moment." "So, we need to

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be harvesting with combine harvesters and tractors in Germany as well," he concluded after a
rigorous examination of agricultural trends in Germany and overseas.

(A forward-thinking but extremely daring design. Initial tests on the “Brenner” CLAAS PTO
combine harvester were something of a disappointment.)
This visionary idea that started to germinate in the minds of a select few already in the late
1920s was not all that new. For quite some time, large numbers of combine harvesters had been
working the fields in North America. The German imperial Agricultural Equipment Committee
(Reichskuratorium für Technik in der Landwirtschaft) had recognized this requirement as well and
had conducted some tests in Germany with American-made machinery — but to no avail. The
grain in Europe had far longer stalks, had much higher moisture levels in many cases than in the
United States, and was often lying flat on the field surface due to unfavorable weather conditions.
These harvesting conditions proved too much for the American combine harvesters to handle. The
stalks entangled themselves in the machine drums, causing continuous breakdowns. In the face of
reservations and doubts among German researchers and farmers about the combined reaping and
threshing process, Vormfelde's appeals for increased mechanization in agriculture went practically
unnoticed at first. Understandably, the established agricultural machine sector was wary of any
significant changes in the situation. They were still making a nice profit on their stationary
threshing machines and had no willingness to take a chance on the new "direct harvesting
procedure.". Another obstacle was public acceptance of the new machine in a country that was still
in recession after the Great Depression and had six million unemployed to cater for. Was this really
the time for a machine designed to replace human labour?
Accordingly, Vormfelde found that the task of convincing public opinion in general, and
particularly the leading producers of reaping and threshing machines, was simply impossible. Yet
he still felt he was on the right track with his idea. Finally, one day he said to his research assistant,
Dr. Walter Brenner: “Instead of knocking on the door of the big firms who have already turned us

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down, let’s go to the small operators of the Claas brothers, for example. I know the oldest brother,
Bernhard Claas, personally. And August Claas, his younger brother, is an optimist and a capable
operator who isn't afraid to take risks.”
In 1930, Walter Brenner, then 31 years old, travelled to Harsewinkel to pay a visit to the
Claas brothers, as instructed by his boss. CLAAS and Bonn University wasted no time in finalizing
the agreement, and Brenner joined CLAAS shortly after. His mission was to design a combine
harvester that would be suitable for use in European settings. Brenner recounted the challenging
beginnings of the combine harvester development project at the time in remarks recorded in
August Claas' 75th birthday. “Like every big achievement, our work on the construction and
development of the combine harvester started on a very small scale, with many hesitations along
the way. In the initial years (1932–34), we managed to manufacture only one or two experimental
machines a year, which were less than completely successful, but taught us many valuable lessons.
Because we equipped the drums with a long 25-metre belt, which provided us accurate numbers
for their performance in the combine harvesting (reaping and threshing) operation, the initial phase
was devoted completely to testing with threshing drums, which were a new concept at the time.
We learnt a lot along the road, and we gradually figured out the optimal mix of power, force used,
threshing process, and threshing drums for our goal of building a small combine harvester that
would be inexpensive and acceptable for German farmers harvesting German fields."
Yet the early stages of the project were very trying and frustrating for the development
team. The prototype of the first CLAAS combine harvester was constantly breaking down in the
field. It was a “front cutting” machine, simply “stuck on” to a Lanz Bulldog tractor, so it was
already looking ahead to the idea of a self-propelled harvester. The grain was carried around the
tractor to be threshed at the back after being cut on the front cutting machine. This was a really
mature, as well as gutsy, approach. Specialists from every section of the agricultural business
gathered in a field near Harsewinkel for the prototype's first public demonstration. The only
harvest, however, was not sacks of grain, but furrowed brows and shaking heads, as the prototype
had broken down. But they repeated the exercise the following year, already with better results. If
only they could find even one industrial partner to shoulder the high development costs for such a
major project, they thought. August Claas: “We loaded our second combine harvester model onto
a railway wagon and took it to Zweibrücken. The management from Lanz came to look, smiled,
and shook their heads, and headed off to a local café to tell a few jokes – but not to talk about our

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combine harvester.” At that moment, August Claas decided he was fed up with waiting for others
to come on board. “If no one wants to join us, we’ll do it on our own”, he said, backed up by his
youngest brother Theo in particular.

(Chief designer for the first CLAAS combine harvester: Dr. Walter Gustav Brenner)

After the outright rejection of its “front cutting” combine harvester, from 1935, the team
focused solely on building a trailed machine. This time, they decided to play it safe, and return to
the proven components of existing harvesting technology. The principle was a simple one:
• Take a traditional mower-binder machine and threshing machine.
• Split the mower-binder between the reaping platform and straw binder.
• Insert an ultra-compact threshing machine between the two halves and join the parts up
into one integrated machine.
The CLAAS mower-thresher binder, or "MDB" for short, was there (from the words in German).
"The outcome was a mower-thresher-binder (MDB) ideal for German conditions, a machine that
reaped the crop, threshed the grain, and bound the straw all at the same time," according to the
CLAAS combine harvester journal of the period. It was the first of its kind in Europe." For the
1936 harvest season, the machine bearing the serial No. 1 was delivered to the Zschernitz farm
near Halle (Saale). The tagline used in later company brochures marketing Dr. Ing. Brenner's
mower-thresher-binder was "getting the work done in a single step." The benefits of the machine,
which was first developed specifically for German conditions, were impressive: it reaped the crop
like a binder-mower, threshed the grain like a normal wide drum thresher, bound the straw like a
straw binder, performed two grain cleaning cycles, and separated the grain from the chaff. The
new combine harvester could pay for itself with as little as 62.5 hectares of farmland, and threshing
yields of 15 to 20 tons of grain a day are incredible for the period.

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(Already by 1942, the plans were ready for the new combine harvester generation, the CLAAS
SUPER.)
The 100th CLAAS MDB machine entered the harvesting fields in 1939. Official limitations
limited Harsewinkel's manufacturing to only 450 units per year during the war years of 1940 and
1941. Almost 1,400 MDB devices were sold in total. The government then outlawed the
manufacture of combine harvesters in January 1943, forcing the company to shift its focus to the
production of armaments. However, this did not deter the development team under Dr. Walter
Brenner and August Claas from continuing to work on improving the design. By 1942, the CLAAS
SUPER, the third generation of combine harvesters, had been designed. CLAAS engineers
designed a combine harvester with remarkable technical dependability and cost efficiency based
on ten years of combine harvester development, six years of series manufacturing, and the
harvesting outcomes of 1,400 MDB combine harvesters across Europe. Apart from the tractor, the
mower-thresher machine ("Mähdrusch") was to revolutionize the agricultural farming
environment in a way that no other machine had done before. This heralded the start of a new era
in European grain harvesting.

1946 – 1968 (Transition to Combine Harvester specialist)

In the summer of 1946, British government representatives in London paid practically daily
visits to the Harsewinkel plant, inspecting the production line and the semi-completed or finished
machinery on the premises. In the United Kingdom, as in Germany, the agricultural industry had
a lot of ground to make up in terms of technological progress following the war. They turned to
the former adversary for remedies to the severe food shortages at home and in the occupied parts
of Germany and found them in the CLAAS development department. When representatives of the
British military government took one of CLAAS' three SUPER combine harvesters which had just
recently been created – and shipped it off to England, the personnel at CLAAS were stunned. They
were concerned that the new machine, which they hoped would be the foundation for the

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company's future wealth, would now be manufactured in England as a kind of war reparations.
These suspicions, however, were unjustified.
All that happened was that the British Ministry of Agriculture commissioned an English
testing body to put the machine through its paces in local harvesting conditions, and the CLAAS
combine harvester received a perfect score. Even its English and American rivals were outdone by
the SUPER. This victory helped to pave the way for the company's successful postwar rebirth, as
it was finally granted permission to recommence manufacture of its combine harvester. The
company began to receive consignments of key inputs for its production activities, such as iron,
tyres, coal, and timber, as raw materials became available again. The factory in Harsewinkel was
extended, and the development department offices eventually became a hive of activity again. The
company delivered its first shipment of 13 combine harvesters to the British Isles in 1976, to the
"Mann & Son" enterprise in Saxham, East Anglia, which specializes in grain farming. The
company previously sold Lanz tractors and now plans to sell CLAAS combine harvesters. In 1948
and 1949, CLAAS shipped several hundred devices. The company's operations have now been
effectively resumed following the conflict.
However, in other parts of Europe, particularly Germany, the manufacture of straw binders
and stationary threshing machines thrived in the postwar years and into the 1950s. In Europe,
CLAAS was nearly the sole manufacturer of combine harvesters. There were two main reasons
for this: first, not everyone was convinced of the new combined reaping and threshing process's
virtues, and second, CLAAS was far ahead of the competition, with about 1,400 machines in the
field and development expertise dating back to 1930. It took some time for competition to emerge,
but by the end of the 1950s, Europe had more than 30 combine harvester manufacturers. This
sparked fierce competition in the market for combines harvesters. Next, the Harsewinkel team has
been preparing for this possibility for quite some time. Every morning, together with the sales
manager, Walter Voss, and the factory manager, Alfons Siepenkort, the three controlling partners
the brothers August, Franz, and Theo Claas could be found sitting around the "office" desk, reading
the mail. This discussion served as an excellent daily briefing on the present state of what was still
a tiny family business. When the day's work was done, they would often get together to drink a
glass or two of "Münsterländer Korn" (corn schnapps). Many of their best ideas came from a chat
while relaxing with a cigar, and the discussions would occasionally last late into the evening.

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During one of these meetings, they took the historic decision to make maintaining market
leadership in Europe their primary goal. This was an extremely ambitious aim for a tiny company
competing against much larger worldwide competitors. It soon became clear that keeping up with
the rapidly expanding demand for combine harvesters, as well as maintaining timely delivery,
would be their biggest difficulty.
To keep up with the competition, the company would have to increase its manufacturing
capacity and, more importantly, grow its distribution network, which is no easy undertaking for a
family business with no outside financing. As a result, the partners decided to devote all of the
company's resources, including personnel, research and development, manufacturing, and sales, to
the combine harvester. As a result, production of other items, including the company's very
profitable baler sector, which had made the company famous in its early days, was dramatically
reduced. The firm’s first off-site plant is a foundry to supply the combine harvester plant in
Harsewinkel with cast iron parts was opened in 1948 in Gütersloh-Blankenhagen. Six years later,
in November 1956, a third production operation was set up in Paderborn, to make the drive and
hydraulics components for the firm’s combine harvesters. The partners were on the lookout for
suitable production locations across the border in France. In 1953, August Claas purchased a
construction site of approximately 9 hectares in St. Remy-Woippy near Metz in Lorraine. Here, in
the heart of Europe, at the point where three countries meet (France, Germany, and Luxembourg),
he planned to set up a completely new baler production operation. The construction of the new
baler plant was held up by protracted negotiations with SNCF, the national French railway
operator, but production finally started in autumn 1961. In 1960, a further plant was set up in
Schloss-Holte near Bielefeld, to produce hydraulics components.

(Beginning of a new era: a parade of the first self-propelled CLAAS combine harvesters,
introduced from 1953.)

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(Color sales brochures for combine harvesters were introduced in the 1950s)

This capacity expansion was supported by a concerted effort in the sales department to
expand the combine harvester's market. August Claas and his son Helmut spent several weeks in
South America (Uruguay, Argentina, and Brazil) in the end of 1950, examining the potential for
CLAAS machines in the region and establishing the necessary commercial relationships for an
export operation. There was even talk of creating a production facility in Uruguay at one point,
but the plan was eventually canceled. The firm's distribution structures had to be strengthened to
increase unit sales. The strategy was to place "plant representatives" in the respective markets,
tasked with finding qualified dealers and agents and assisting them in their operations. CLAAS
then designated a general importer for each country, who was in charge of both import and
distribution. The firm maintained tight and good contacts with these international representatives
in general. There were also a lot of marketing promotions. Hands-on field demonstrations and
agricultural machinery shows proved to be the most efficient types of marketing. With the help of
the Customer Service department and the international representative organizations, they were
regularly organized in an exceptional manner. To ensure a professional standard of marketing and
customer communication, a Press Relations and Advertising department was also set up as early
as the mid-1950s. Its mission was to execute regular marketing campaigns in agricultural print
media to raise awareness of the new combined reaping and threshing procedure. Half-page ads
gave way to full-page ads, another area in which CLAAS was a pioneer in the agricultural machine
sector. Every two weeks during the harvesting season, the enterprise was highlighted in a weekly
periodical. Machine brochures got more detailed, colorful, and educational as well. Targeted
mailouts and high-production-value commercial videos were also utilized to persuade those who
were still skeptical of the benefits of the combined harvesting method.

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The company's new production plan, which centered on the combine harvester, paid off
handsomely. The company continued to grow at a breakneck pace in the years that followed. After
the war, the Claas brothers reopened the company in 1945 with only 127 employees. That number
had more than fivefold increase in just five years, reaching 660. To fulfill future production
demand, the company had to open the previously mentioned new manufacturing plants, as well as
begin hiring large numbers of personnel from other countries, mainly Spain. In 1965, when
combine harvester output peaked, the Harsewinkel-based agricultural machinery manufacturer
employed almost 5,300 people. Since 1945, combined harvester productivity has climbed by an
average of 80% every year. Sales revenue increased from over DM 12 million in 1949 to over DM
370 million in 1965, demonstrating this. The combination harvester became the top product in the
agricultural machinery business in terms of revenue within a few years as the technology became
more extensively used. CLAAS plants accounted for more than half of the total German combine
harvester industry in 1961, with sales of DM 288 million. CLAAS had thus become one of the
foremost combine harvester and agricultural machinery manufacturers, not just in Germany, but
worldwide, in under two decades. With its innovative knotter and straw binders, what had started
as a small family business in eastern Westphalia had grown into one of the established large players
on the international agricultural equipment stage.

1969 – 1988 (CLAAS Harvesting Specialist)

The late 1960s were a time of great economic, political, and social change, and the
agriculture sector was no exception. Following the euphoria of farms adopting agricultural
technology for the first time, the market began to cool towards the end of the 1960s, owing to a
fundamental structural upheaval in farming. "Grow or perish" was a popular phrase at the time,
and it applied equally to farmers and agricultural machinery makers. As a result, a few machinery
manufacturers, including some well-known names in the industry, threw in the towel and exited
the market permanently. In Germany, combine harvester unit sales were just 54% of the previous
year's total in 1970/71. This new circumstance resulted in significant changes for CLAAS,
prompting a rethinking of the company's future direction. In retrospect, what many viewed as a
crisis threatening the company's very existence really provided the impetus for a major
modernization program, which was exactly what the corporation needed following a time of rapid
development. CLAAS emerged from the agricultural machinery sector's crisis with a slew of

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creative, forward-thinking goods. The market's turmoil pushed CLAAS to reconsider its
specialized strategy, which had been entirely concentrated on the combine harvester.
Despite this, the combine harvester remained a part of the picture as the company's "bread
and butter" machine, which it couldn't afford to ignore as its diversification progressed. By the end
of the 1960s, the gradual change from trailed to self-propelled vehicles in the European market
had largely been completed, and the iconic SUPER machine had had its day. The majority of
farmers' trailed tractors were progressively being replaced with small self-propelled vehicles
costing less than DM 10,000. The shift to self-propelled machines coincided with a tendency
toward collaboration among neighboring farms, machine ownership collectives, and contract
threshers, resulting in ever-higher-capacity machines, more powerful engines, broader mowers,
and larger grain tanks. CLAAS responded to the agricultural sector's transition by launching a
brand-new development program known as "Project 12," but better known as the DOMINATOR.
The DOMINATOR, which initially entered into harvesting operation in the summer of 1970, was
built in an extraordinarily short amount of time using the "simultaneous engineering" principle, in
which development and production occur practically simultaneously. CLAAS set new standards
in worldwide combine harvester construction with the DOMINATOR. The new modular
construction allowed for more rationalization, resulting in significant cost savings and decreased
inventory levels in the production operation. In the field, the new combine harvester was likewise
a standout performer. The DOMINATOR became Europe's best-selling combine harvester model
during the next few years, thanks to its high productivity, dependability, and "multi-crop" capacity.
The corporation reached the billion DM sales revenue milestone for the first time in the 1983/84
fiscal year. It was now up to him to keep his leadership position. This was accomplished with the
new CS model, which replaced the straw walkers with an eight-cylinder "cylinder system" (CS).
The DOMINATOR 116 CS was the first machine to use the new system, which was debuted in
1981. With the introduction of the MEGA threshing system with upstream accelerator drum in
1993, throughput was increased by up to 30%. For more than two decades, the DOMINATOR has
been the cornerstone of the CLAAS combine harvester line.

1989 – Today (Growth, Internalizations, Digitalization)

CLAAS has a long history of successful international competition, thanks to its specialized
strategy of focusing all resources on the combine harvester, and subsequent specialization in

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harvesting, and to the Bautz/Speiser acquisitions. CLAAS was able to get by without having its
own tractor line for a long time in its history. The trend toward tractor manufacturer consolidation
in the 1980s and 1990s, however, resulted in fundamental shifts in the market landscape, requiring
the company to adapt its product and corporate strategy once more. As a harvest specialist pure
and simple, without its own tractor, CLAAS was left in an uncomfortable and precarious position
in the marketplace. For decades, CLAAS machines had been sold in dealerships in conjunction
with the products of tractor specialists. However, as tractors-only manufacturers gradually faded
from the market, either by adding a harvesting machine to their own product line or by being
acquired by a full liner, there were fewer and fewer possible tractor partners available, putting
CLAAS in a weaker position with machinery dealers. The end of a series of long-term agreements,
such as the one with Ford in North America, has caused substantial turbulence in the dealership
network, resulting in dramatic increases in downstream distribution costs. So, it was evident that
CLAAS needed its own tractor in order to be successful in the long run.
Then, in 2002, the corporation was presented with an unexpected chance. Renault
Agriculture was up for sale as the parent company chose to sell off all of its non-automotive
businesses. Renault Agriculture was a medium-scale manufacturer at the time, providing CLAAS
with one of the last opportunities to reach the mass standard tractor market category. CLAAS took
swift and decisive action. Helmut Claas and Patrick Faure inked a major deal in Paris ahead of the
Sima 2003 trade show, first for CLAAS to buy a stake in Renault Agriculture, and then, in a series
of phases, for CLAAS to take over the Renault tractor business altogether in 2008. At Agritechnica
2003, a full range of seed-green-liveried tractors, ranging in horsepower from 72 to 335 hp, were
on display, with CLAAS' XERION big tractor serving as the showpiece. They symbolized the
company's achievement of a significant objective. It not only raised the company's profile for its
own dealership network, but it also provided fresh opportunities for future growth. CLAAS has
gone from being a harvesting expert to a full liner.

2.0 PRODUCT PORTFOLIO

CLAAS is a well-known harvest expert, with a variety of combine harvesters to choose
from. The LEXION, which has been produced since 1995 and is now in its fourth iteration, is the
most popular model series. The LEXION 8900 produces 790 horsepower and comes with tyres or
crawler tracks (TERRA TRAC) on the front axle. Both options have a top speed of 31 miles per

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hour (50 kilometers per hour). The cutter bars can be as wide as 13.79 meters, and the grain tank
can store up to 18,000 liters of grain. The TUCANO and AVERO are two smaller combo product
families offered by CLAAS. CLAAS introduced TRION, a new harvester product line, in August
2021. TRION 700, TRION 600, and TRION 500 are the three models in the TRION 700, TRION
600, and TRION 500 series. Cummins engines are used to power them. JAGUAR is the name of
the CLAAS forage harvester. In the silage chopper market, CLAAS is regarded as the global
market leader. The company makes and sells tractors with engines ranging from 47 to 530
horsepower. The XERION is the largest tractor in the CLAAS lineup, and it stands out thanks to
its four equal-sized wheels. The AXION model series ranges in horsepower from 205 (AXION
800) to 445 (AXION 960). Since 2019, CLAAS has provided an optional track system called
TERRA TRAC that replaces the rear wheels on the AXION 900 series. The ARION model range
includes tractors with engines ranging from 95 horsepower (ARION 410) to 205 horsepower
(ARION 205). (ARION 660). The ARION 400, ARION 500, and ARION 600 are among the
ARION models.

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3.0 CAPITAL MARKET

The funding of the CLAAS company is an important part of our strategy since it lays the
groundwork for future growth. As a family-owned business with a capital market presence, we are
paving the road. CLAAS, like other publicly traded companies, uses the capital markets to get
long-term and thus reliable corporate financing. We have the advantage of not needing to judge
our success exclusively on a quarterly basis as a family-owned business; instead, we can focus our
corporate policies around long-term value development.

4.0 SALES AND EARNINGS

Despite a major slowdown in the overall market, CLAAS, one of the world's largest
agricultural machinery manufacturers, was able to grow its sales income to a new all-time high of
3.838 billion euros (prior year: 3.823 billion euros). With earnings before tax of 158 million euros
(previous year: 155 million euros), CLAAS achieved a return on sales of 4.1 percent.
• Sales revenue increases to 3.838 billion euros
• Earnings before tax reach 158 million euros
• Double-digit sales growth outside Europe
• Outlook for 2016: Stable sales and earnings
"We are delighted that we have been able to overcome the current weakness in the market thanks
to our international structure and wide product range. Our double-digit sales growth outside
Europe was a positive factor in our results", said Lothar Kriszun, Speaker of the CLAAS Executive
Board. This year, the global market for professional agricultural machinery will contract by
roughly 20%. Customers' purchasing habits are being negatively impacted by falling commodity
prices and relatively new machinery fleets in many places. Nonetheless, CLAAS has been able to

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enhance its leadership position throughout Europe. Sales in North and South America are
increasing, whereas sales in Eastern Europe are decreasing. CLAAS has continued to develop in
India, whereas the market for maize pickers in China has stabilized.

5.0 WORLDWIDE GROWTH IN EMPLOYEE NUMBERS

As of September 30, 2015, the total number of employees worldwide had risen to 11,535.
(Previous year: 11,407). This was mostly due to increased personnel numbers in China and the
expansion of global sales activity. The number of employees has increased by over 20% in the last
two years. CLAAS employs 5250 people in Germany and is devoted to training its own junior
employees. In 2015, the company's trainee ratio was at an all-time high of 7.8%. (Previous year:
7.3 percent).

6.0 STRENGTH
• Development and modernization of production sites and sales locations
CLAAS concentrated on material asset investments in Russia, France, and
Germany. At the beginning of October, the most advanced agricultural machinery factory
in Europe began operations in Krasnodar, Russia's south. Following that, CLAAS signed
a letter of intent with the Russian Federation to be classed as a "Russian producer." There
is a significant need for effective harvesting technology, and there is a constant need to
modernize. At the testing center at Trangé, France, two new large-scale test benches have
been installed. The upgraded facilities allow for a four-week simulation of a tractor's entire
service life. The warehousing technology at the Hamm, Germany, location was upgraded
to ensure that worldwide replacement parts supply may be carried out as efficiently as
feasible. Other significant areas of investment included the global expansion of the sales
and dealer network, as well as the further digitalization of procedures.
• Strong focus on research and development
Investment in research and development remained at a high level, at 203 million
euros (prior year: 212 million euros). New services, as well as harvesting machinery and
tractors, have been prioritized. CLAAS hopes to further solidify its market leadership
position in the premium combine harvester area with the new LEXION. Machine

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modifications to meet the new statutory emissions criteria needed additional development
costs. Currently, one out of every ten CLAAS employees works in research and
development.

The market drivers that are relevant to CLAAS are unchanged: Despite the probability of periodic
fluctuations, demand for agricultural raw resources will continue to rise as the population and
living standards rise. CLAAS, on the other hand, expects further drop in the global market in the
current fiscal year. The effects of political and economic crises in emerging economies, as well as
negative changes in agricultural income, are driving a general reluctance to purchase agricultural
gear. CLAAS expects to maintain revenues at the same level as last year and achieve consistent
earnings before taxes, thanks to its well-positioned range of products and services.

7.0 WEAKNESSES
Despite continually difficult markets, CLAAS, one of the world's largest agricultural machinery
manufacturers, maintained sales at a high level of €3.631 billion (previous year: €3.838 billion).
Income before taxes decreased to €93 million (prior year: €158 million), primarily due to a fall in
volumes.
• Sales down slightly to €3.63 billion from previous year’s record-breaking figure
• Income before taxes at €93 million
• New record spending on research and development
• Double-digit sales growth in Eastern Europe
• Outlook for 2017: Slight fall in sales and stable income

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"In rapidly diminishing markets, we have maintained our position admirably," remarked Lothar
Kriszun, Speaker of the CLAAS Group Executive Board. "In Eastern Europe, double-digit growth
had a stabilizing effect. At CLAAS, we're pushing forward with our efficiency program while also
maintaining our methodical investment in digitalization and internationalization, bolstering our
efforts to combat this long-term market downturn." This year, the global market for professional
agricultural equipment suffered a large drop in many regions. The market for combine harvesters
has fallen by 50% in North America and 22% in Europe since 2013. CLAAS profited from
increased sales in Eastern Europe as well as sustained growth in France. All other regions saw a
drop in sales. Stronger sales of secondhand machinery and continued expansion of the service
business were able to partially compensate for the reduction in Germany.
• Slight decrease in number of employees worldwide
As of September 30, 2016, the number of employees worldwide had decreased marginally to
11,300. (Prior year: 11,535). This is due to dwindling agricultural equipment markets around the
world. In Germany, CLAAS continues to employ 5,200 people and is devoted to developing its
own talent. In 2016, the proportion of apprentices to full-time equivalents was at an all-time high
of 8.2 percent (prior year: 7.8 percent).

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8.0 EMPLOYMENT OPPORTUNITIES

We contribute to the world's nourishment as one of the world's leading manufacturers of
agricultural machinery. Whether it's through direct entrance, internships, apprenticeships, or dual-
study programs, new colleagues, whom we continue to seek out and hire, help us achieve our
common objective of harvesting the future more than ever before.

9.0 CONCLUSION
As a conclusion, CLAAS is a family-owned company that was started in 1913 and is one of
the world's leading agricultural engineering equipment producers. The firm is the European market
leader in combine harvesters, with headquarters in Harsewinkel, Westphalia. In another important
product category, self-propelled forage harvesters, CLAAS is the world leader. With tractors,
agricultural balers, and green harvesting machines, CLAAS is a global leader in agricultural
engineering. CLAAS also has cutting-edge farming information technology in its product offering.
CLAAS employs 11,400 people worldwide and has a revenue of 4.0 billion euros in the fiscal year
2020.

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10.0 REFERENCES

The Group. History | CLAAS Group -. (n.d.). Retrieved from https://www.claas-group.com/the-

group/history/company-history

The Group. Tractors - Product history | CLAAS Group -. (n.d.). Retrieved from
https://www.claas-group.com/the-group/history/products/tractors

Investor relations. Investor Relations | CLAAS Group -. (n.d.). Retrieved from

https://www.claas-group.com/investor/capital-market

Press / Corporate Communications. Press releases | CLAAS Group -. (n.d.). Retrieved from
https://www.claas-group.com/press-corporate-communications/press-releases/claas-
reports-stable-sales-and-earnings/775534

Wikimedia Foundation. (2022, April 5). Claas. Wikipedia. Retrieved from

https://en.wikipedia.org/wiki/Claas

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11.0 APPENDICES

(Combine Harvester) (Balers)

(Forage Harvester)

( CLAAS Brothers)

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