Renting vs. buying a tractor

[JATO_RaT]

Convenience, that is an important part of owning your own tractor. I have started my tractor up simply to pull one tree over, to pop a rock loose, bring a single load of dirt from one spot to another, fill in some pot holes, push my burnings in tighter, compacted the load in my truck for more material when going to the dump, pulled out lots of t posts over the course of years, mowed a single spot of weeds that was in my way, lifted a 800lb compressor out of my truck, a mower out of the truck, helped neighbors at various times, etc., really thats the short list. These are all things that I would never have thought about going out to rent one for, if none of this is a concern or you already have a mower and you simply want to move some dirt around, rent it, they do all the maintenance and repairs. Problem is, 150 hours is actually quite a bit of work and rent. My local rental yard lets us have a tractor for 24 hours but you get 8 hours of use, after 8 hours you pay extra. If you cannot pull the tractor with your truck, throw in the transportation, if I haul it myself, I also must rent the trailer. Having a tractor on site is excuse enough to do things you otherwise might not do.

Other advantages include posting ad nauseum about the oil you have decided to put in it in the oil lubricants section.

Rat...

 

[MossRoad]

Lets say you buy a tractor for $15,000.00. If you put 150 hours a year on it it will cost you...

$100.00 per hour for first 150 hours(year one)
$50.00 per hour for the first 300 hours(year two)
$33.33 per hour for the first 450 hours(year three)
$25.00 per hour for the first 600 hours(year four)
$20.00 per hour for the first 750 hours(year five)
$10.00 per hour for the first 1500 hours(year 10)
$5.00 per hour for the first 3000 hours(year 20)

Of course, this doesn't include any maintenance or fuel. Just a simple table.

Now compare that to what it will cost you at the rental yard per hour and you see that if you are only going to use it a few hours a year, it is smarter to rent. The more hours per year, the less $$ per hour to own. Hope this helps. /w3tcompact/icons/smile.gif

 

[Anonymous Poster]

Mossroad,
I agree Owning is the way I go. It just does not totally make money sense. But it is much more convenient. And what I WANT.

btw... you probably need to add about 200 - 500 per year after the 3 year warranty is up for maintenance on the tractor and attachments, tractor parts are not cheap. No need to figure in fuel, you would buy that if you rented a tractor too, however Hytran hydro fluid changes are not cheap. Plus did you include finance charges. Quite often a 15k tractor will cost you over 20k.

With all this I still choose to own

 

[frank_f15]

u don't say what your needs are, how much land and what do u want to do with it, but 150 hrs a year if u are like most of us will be spent in short periods of time. during the winter i might only put 10 or 15 hrs on it,BUT that is for plowing snow, now kinda dificult to wait for a snow and then call to have a tractor delivered for 2 hrs work then send it back and oops it snowed again and call and get another, see what i mean? need it for an hour? u pay for a day. if u have that much use for one BUY IT!!!!! /w3tcompact/icons/smile.gif

 

[s1120]

I know a compact tractor is a lot of money, and it seems cheeper to rent. How about this? Buy used. OK, it may take a little more work to fix things, but what better way to get to know your tractor./w3tcompact/icons/smile.gif Plus, 10grand is a lot better then 20.

 

[CTyler]

For me buying is better vs renting for most things, house, car, tools, trailer etc.. This is why I own rental property as well. The renters build all the equipty for me and I just smile.

I just bought a L3130 w/BH and other implements. I had to figure what it would cost for snow removal on a 500+' driveway every year. Also grading, ditching and speading gravel. Then there is the gravel around the out building. Couple tile projects, digging for tree planting(about 500), digging the septic, leach line, geothermal heating/cooling feild, water to well(600'), electric, finish mowing a couple acres etc.. etc.. The tractor will pay for itself in my case within 10 years.

I will still rent some things that I only need one or twice. I just rented a CAT 813 and 815 for some dirt work. Will rent a excavator for a day to dig the basement rough out. Then finish it with my BH. I'll rent a power rake when I'm ready to seed the lawn.

It depends on your needs and if you have room to keep it.

Chris

 

[stmiller2]

Using some info from Doane's Agricultural Reports & the rental rate from Super7 ($400/24 hours = $16.67/hour), I calculated the hours of usage at which the cost of renting would equal the cost of buying.

The smallest tractor in Doane's is 40 HP. They estimate the annual overhead (interest, insurance, housing) at $920 and depreciation at $1,128. Thus, the annual ownership cost is $2,048. They estimate the operating cost to be $2.67/hour, $2.02 for fuel & oil + $0.65 for maintenance & repair.

Assuming you would be responsible for the fuel cost if you rented, the difference in operating cost is $16.02/hour ($16.67 + $2.02 - $2.67).

Dividing this result into $2,048 gives 128 hours/year as the breakeven point between buying & renting. If you expect your annual usage to be less than 128 hours, rent. Otherwise, buy.

Note that these calculations ignore the convenience of having the tractor when you want, and the costs and time for getting the rental tractor to your location, etc.

 

[hazmat]

<font color=blue>If you expect your annual usage to be less than 128 hours, rent. Otherwise, buy.

Note that these calculations ignore the convenience of having the tractor when you want, and the costs and time for getting the rental tractor to your location, etc. </font color=blue>

First question is the $400 per 24 hours on the tractor or for one day of rental? If it is for one day of rental, then how many hours are you actually going to use it 10, 12? That makes owning it more attractive. 10 hours gives $40 an hour and makes buying it pay back in about 50 hours.

Even excluding the convenienece of having the tractor when you want it, these calcs are only valid for big projects, Ie: Grade a new lawn, dig out a few dozen stumps etc. They don't apply to small repetative tasks, ie mow the lawn for an hour as the rental is $400 for 24 hours.

 

[markie61]

Most rental companies I have dealt with are:
1 day = 24hours on the clock OR 8 hours on the meter, whichever comes first.
Anything over 8 hours on the meter is prorated per hour.
I always try to rent on a Saturday, because they don't expect it back until Monday - you get an extra day to use your 8 hours.
Mark

 

[RanchMan]

<font color=blue>1 day = 24hours on the clock OR 8 hours on the meter, whichever comes first</font color=blue>

Yup. That's what I've always seen too.