CHICAGO (Reuters) - The top executive at farm equipment maker Agco Corp (AG.N: Quote, Profile, Research, Stock Buzz) said on Monday that he believes the company's money-losing U.S. operations will come close to turning the corner in 2008 and reaching profitability.
"Last year we already would have been break-even if the dollar wouldn't have turned against us," President and Chief Executive Martin Richenhagen told the Reuters Manufacturing Summit in Chicago.
"This year we will come very close .. It's a lot about volume ... The more volume we sell the better it is."
Richenhagen also said the company had just signed a joint venture agreement with an unnamed Russian company to make off-highway diesel engines for the Russian market. He said the JV would be producing 20,000 engines a year within three to five years.
Richenhagen also expressed optimism that global demand for farm equipment had entered a new, less cyclical period thanks to growing demand for food in the developing world and the push for renewable, crop-based biofuels such as ethanol.
In North America, he predicted industrywide sales of tractors and combines would rise 5 to 10 percent in 2008, thanks, in part, to the new stimulus package which gives farmers a tax incentive to buy new equipment now.
(Reporting by James B. Kelleher; Editing by Gary Hill)
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