Daedong targets W130b in parts sales this year, eyes AI farming platform as new growth engine

Daedong is building its parts and aftermarket business into a core growth engine, anchored by its AI farming platform. The company is moving away from a hardware-sales-driven model toward a recurring revenue structure that combines equipment fleet management, predictive maintenance and subscription-based services.

Daedong said Tuesday that its parts business sales are expected to reach about 130 billion won ($86.4 million) this year, up 30 percent from last year's roughly 100 billion won. Compared with 81 billion won in 2024, that would represent roughly 60 percent growth in two years. The company also set a target of expanding parts sales to 300 billion won by 2030.

Through its AI farming platform, Daedong is building an integrated system connecting agricultural data collection, AI-based farming decisions, autonomous field operations and equipment fleet management. Building on that foundation, the company is expanding a service-oriented business model that continues to provide parts replacement, regular inspections and software updates after equipment is sold.

Daedong cited several drivers behind the parts business growth: stronger service policies, expanded domestic and overseas service channels, a global supply chain buildout, a broader product lineup and more advanced AI-based equipment management.

In South Korea, the company offers a 10-year or 3,000-hour free warranty on tractor engines and transmissions, along with a free 50-hour inspection for farm machinery. Last year it also launched a warranty extension product that allows customers to extend coverage for up to three years beyond the standard warranty period.

Daedong is also expanding its maintenance infrastructure. Last year it introduced "Daedong Service Master" outlets — shops dedicated exclusively to repairs, with no sales function. Two locations opened in South Jeolla Province and North Chungcheong Province in the first half of this year, and the company plans to add two more in the second half to strengthen service capacity.

The company is reinforcing its overseas supply chain as well. Last year it established an integrated logistics warehouse spanning about 29,370 square meters in Tacoma, Washington, stocking roughly 4,000 parts items. Daedong plans to expand its logistics processing capacity by next year and is reviewing the introduction of AI and automation systems at the facility.

In North America, Daedong is pushing to expand the dealer network for its farm equipment brand KIOTI. The company aims to grow its dealer count from about 570 at the end of last year to 1,100 by 2030, a move it expects to drive both sales growth and demand for parts and maintenance services.

Overseas, Daedong is expanding its lineup of compact construction equipment such as skid steer loaders and mini excavators, while domestically it has launched AI tractors, drones and transport robots to generate greater demand for maintenance and parts replacement. The company also manages equipment status, maintenance history and parts replacement cycles through its "Connect" app, and provides symptom consultation and maintenance recommendations via its AI chatbot "AI Daedong-i."

Industry observers say the farm equipment market is following a trajectory similar to the automotive sector, where post-sale services and parts businesses are becoming increasingly important. As AI and telematics technology spread, predictive maintenance and remote management are emerging as significant new revenue streams. Daedong plans to launch a subscription service product by next year that bundles regular inspections, consumable replacements, remote diagnostics and warranty extensions.

Lee Yong-dae, head of Daedong's parts and service business division, said the company would "leverage telematics-based equipment operation data from home and abroad to advance parts demand forecasting and predictive maintenance services, and continue to expand our recurring revenue base."