880266--3/13/2006--AGCO_CORP

related topics

{cost, operation, labor}

{operation, international, foreign}

{product, market, service}

{customer, product, revenue}

{cost, regulation, environmental}

Our success depends on the introduction of new products, which requires substantial expenditures. We face significant competition and, if we are unable to compete successfully against other agricultural equipment manufacturers, we would lose customers and our net sales and profitability would decline. Rationalization of manufacturing facilities may cause production capacity constraints and inventory fluctuations. We depend on suppliers for raw materials, components and parts for our products, and any failure by our suppliers to provide products as needed, or by us to promptly address supplier issues, will adversely impact our ability to timely and efficiently manufacture and sell products. We also are subject to raw material price fluctuations, which can adversely affect our manufacturing costs. A majority of our sales and manufacturing take place outside the United States, and, as a result, we are exposed to risks related to foreign laws, taxes, economic conditions, labor supply and relations, political conditions and governmental policies. These risks may delay or reduce our realization of value from our international operations. Currency exchange rate and interest rate changes can adversely affect the pricing and profitability of our products. We are subject to extensive environmental laws and regulations, and our compliance with, or our failure to comply with, existing or future laws and regulations could delay production of our products or otherwise adversely affect our business. Our labor force is heavily unionized, and our contractual and legal obligations under collective bargaining agreements and labor laws subject us to the risks of work interruption or stoppage and could cause our costs to be higher.

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880266--3/13/2006--AGCO_CORP_/DE