Machinery giant CNH Industrial is set to almost double its agricultural research and development and capital expenditure investment to $5.51 billion over the next three years.
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The parent company of Case IH and New Holland announced this key commitment at the launch of its 2024 strategic plan in Miami, Florida, last Tuesday.
The company has updated its sustainability targets and committed to the Science Based Targets initiative, which aims to drive climate action in the private sector.
CNH Industrial CEO Scott Wine said the company wants to be an enabler of zero emissions farming.
It is already working towards this goal with the New Holland T6 methane power tractor, which is commercially available in Europe and being rolled out globally.
The machine received international recognition last October when it was named the Sustainable Tractor of the Year 2022 at Italian machinery conference, EIMA.
Mr Wine said biomethane tractors work exactly as a standard production tractor works.
"Biomethane can be produced on the farm, using a combination of animal waste (manure and slurry) and other bio-waste products, such as crop residue, which is then refined and stocked on farm for use in products," he said.
"This is part of a truly virtuous energy independent farm cycle."
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The company also revealed its five strategic priorities - customer inspired innovation, technology leadership, brand and dealer strength, operational excellence and sustainability stewardship.
As part of its financial strategy it will look at disciplined investment internally. It will also develop existing and explore future partnerships through new initiative, CNH Industrial Ventures.
"Michele Lombardi and his team have launched this new initiative, which groups together our existing investments in a wide range of start-ups and innovative technology companies," Mr Wine said.
"CNH Industrial Ventures is the home for these activities, and demonstrates how we, as one of the leaders in the segments in which we operate, are dedicated to bringing to market new technologies and innovations that benefit our customers in terms of productivity and sustainability.
"We also want to be known as a company that supports these technologies to attract interest from other industry start-ups and disruptors."
CNH Industrial projects its net sales of industrial activities will grow to $27b to $30b ($US20b to $US22b) by 2024 with a compound annual growth rate of approximately 6 per cent.
It forecast adjusted 2024 earnings before interest and taxes margin of approximately 12pc to 13pc.
Return on invested capital is projected to reach approximately 19pc with a 3pc growth during the period of the plan.
EBIT margin for agriculture is set to reach 14.5 to 15.5pc by 2024.
Farmers can look forward to more than 150 products being launched between 2022 and 2024 while more than 50 product launches are planned in the construction side of the business.
Significant investment in precision agriculture is also set to continue.
"We see the next steps in terms of the acceleration of highly automated machinery - which today we showcase across our product range, but specifically in terms of combine automation," Mr Wine said.
"Our machines analyse millions of operating combinations every 20 seconds to deliver the highest productivity and quality grain sample. We are already well ahead of our peers in this area.
"Following the completion of the Raven acquisition we have also accelerated our path to autonomy; we are working on various highly automated and autonomous solutions, with specific focus on spraying and spreading as well as increasing usage and adoption in tillage and grain carting."
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