CNH Global increased net sales in the first quarter 22 percent to $4.6 billion as a result of solid trading conditions for construction equipment — driven largely by increased demand in the Americas — and solid trading conditions for agricultural machinery, driven by firm commodity prices.
Equipment Operations posted an operating profit of $406 million as a result of higher revenues, increased industrial utilization, improved product mix and improved net pricing. The breakdown of net equipment sales in the quarter was 78 percent agricultural equipment and 22 percent construction equipment. The geographical distribution was 45 percent North America; 31 percent Europe, Africa and Middle East; 15 percent Latin America; and 9 percent Asia Pacific.
In the quarter, CNH hosted a Russian government delegation at its consolidated joint venture industrial operations in Naberezhnye Chelny, Tatarstan, Russia, celebrating the completion of first-stage production activities at the plant and the signing of a memorandum to supply 80 locally manufactured New Holland tractors and combines. CNH also announced plans to expand manufacturing in Brazil and Argentina.
Looking ahead, worldwide agricultural and construction equipment markets are expected to remain positive for 2012, with construction equipment demand expected to continue its recovery with industry retail unit sales to be up 5 to 10 percent, and agricultural equipment retail unit demand projected to be flat to up 5 percent.
The North American market registered a substantial year-over-year improvement with demand up 45 percent, light equipment volumes up 52 percent and heavy equipment volumes rising 30 percent. Light equipment global demand rose 12 percent, with heavy equipment demand declining 19 percent, with the APAC region dropping 31 percent. EAME and CIS markets continued to improve, rising 14 percent. Demand for light equipment rose 9 percent in Latin America and dropped 1 percent for heavy equipment.