When a corporation starts to concentrate on shareholder value, year-over-year profits, and regenerative income, at some point, it leads to customers getting milked dry. In this case, the milked dry cliché is apt, because the famous tractor company John Deere has made it hard for farmers to diagnose and repair the vehicles they own for a long time. That holds true for independent repair shops as well.

The result was farmers had to turn to John Deere specifically for help, which isn’t always convenient when you have a 50,000-pound tractor sitting dead in the middle of a cornfield. It isn’t necessarily inexpensive, either, but there was no choice in the matter… until now.

A $99 million landmark court case has John Deere paying out over its actions, and the implications could spread beyond farm equipment. Automakers may want to check themselves when it comes to forcing customers to use dealerships for diagnosis and repair.

Farmers Won The Right To Fix Their Own Stuff

John Deere doesn’t admit to wrongdoing as part of this $99 million settlement, but the extreme amount of money involved could easily set a standard for class-action lawsuits like this in the future. Essentially, the money will go towards paying out for dealer overcharges that occurred as far back as 2018. The lawsuit accuses the farm equipment giant of monopolizing repair services by withholding diagnostic and repair software. And this wasn’t a federal case – it took place in the United States District Court for the Northern District of Illinois.

“As we continue to innovate industry leading equipment and technology solutions supported by our world-class dealer network, we are equally committed to providing customers and other service providers with access to repair resources. We’re pleased that this resolution allows us to move forward and remain focused on what matters most – serving our customers.”

– Denver Caldwell, vice president, aftermarket & customer support, John Deere.

The case accused John Deere of conspiring with authorized dealers to force farmers to use them for repair services when farmers could fix tractors and other equipment themselves, or use independent alternatives. On top of that, the allegation is that John Deere and its dealers could then charge higher, “supracompetitive” prices and reap the benefits of an “unlawfully restrained” market. As such, we suspect some bean counters at automakers will have been watching this closely, regarding John Deere as a canary in a coal mine.

Software, Hardware, And A Very Slippery Slope

These days, most machinery runs at least partially on some kind of software. By denying access to that software, automakers can deny everyone except those they want from accessing the systems, including diagnostics. If you can’t diagnose the problem with your software-controlled vehicle, you or an independent repair shop can’t fix it. The good news is that we now have a precedent: John Deere has finalized an agreement to provide the software needed for diagnostic, repair, and routine maintenance of its products.

Building quality products has always been a Catch-22 for companies. Everyone wants a quality product, and automakers are no exception. But, build it too well and you’ll never sell another one. At least on the automaker side, you can figure maintenance into the equation. But dealerships, while usually offering specialized vehicle knowledge, certainly charge a specialized price for the work. Add to that the fact that automakers don’t make money on the resale of a vehicle, and you can understand how the spreadsheet departments have come to the conclusion that there’s money being left on the table.

It’s no wonder, then, that automakers are pushing against right to repair legislation and seeking ever-expanding variations of subscription services. Some have already gone to questionable lengths and used questionable methods to secure such revenue streams. Hopefully, the John Deere case will have a positive effect on the automotive industry as a whole in terms of sticking to standards. But don’t be surprised to see more political and legal showdowns in the future.

Sources: AP News / John Deere