Price Check John Deere unbelievable trade-in offer

[daveinnh]

That sounds similar to something I heard on Marketplace on NPR today. They reported that Toyota dealers are approching their Prius (sp?) owners & leasees to trade in early - but new models are seeling much higher to to low output.

Since most first-tier CUT's are manufactuered in Japan, I'd suppose JD, Kubota, and NH (older?) models may be subject to this approach?

 

[bz1]

Latest news: I called the other local JD dealer near by, he had not heard of such a trade in deal. So I'm confused. Could it just be this one dealer doing this? After the salesman was here today I remembered an interesting thing he said. He said that the trade in deal was meant for people with competitor's tractors to entice them to go green. His next statement was something like "but we figured why not offer this deal to current JD owners so we can get rid of some of our new 2520's while at the same time getting some used ones on the lot that people can afford?" Those two words, "we figured" was perhaps just referring to his dealership? So maybe he's the only one doing it. I just don't know but I'll continue to report each piece of info I have. Eventually I'm going to talk to the dealership manager to make sure this salesman isn't just nuts. Or should I? If one crazy salesman is willing to do a trade for $500 maybe I should just take it before his boss figures out what happened? Still more questions than answers.

BTW, not sure if JD prices are always high. Just so happened I was in a Cub Cadet dealer this past week. Just for kicks I asked him his selling price on a tractor sitting on the floor. It was a CUT tractor with loader and 60+ inch mower deck. He was willing to sell it for a little over 23K. It was the exact identical tractor as the JD2720 except for a few exterior differences and of course the color. The deck was completely different from a JD deck but it looked pretty beefy. I had no idea that Yanmar was building the same machine for both JD and Cub. The JD2720 with deck and loader would sell for closer to $20K.

 

[Gale Hawkins]

If they were doing it in Canada last year why would JD dealers not be doing it in the USA as well?

 

[ole farmerbuck]

Yep, gotta watch this.

 

[Gale Hawkins]

JD seem to have "master" dealers (my term) so not all dealerships may get to run the same promos. They may be getting a deal from the factory based on other inventory they order, etc.

 

[JoeinTX]

It sounds a little crazy but it just may work like this:

-Dealer and J.D. are on a drive to move new tractor model "X" since it's a slow seller or inventory has built up.
-They could reduce the prices on the new, and even may have for some, but don't want to do it too much or set a precedent of "loss leaders" especially among a leading premier brand like J.D. who doesn't want to be perceived as having to "give" tractors away to any Tom, Dick, and/or Harry who walks onto the lot.
-Conundrum set, they determine a sales effort at "upgrading" current customers as a semi-loyalty rewards program
-Economy being what it is (like the used car market which is white hot) consumers have the mindset that buying used is safer and more frugal. Your dealer may have a customer or two lined-up for a recently used tractor model "X" but he doesn't have any so he needs to find one. He goes through his sales files and IDs those he's sold in the last few years and he makes them a mind-blowing offer to trade-up for "brand loyalty."


How do they make money? I dunno exactly but it may not be all money net gain-gain. It could well look better on the books to move one new tractor and also one used tractor as opposed to just one new at a gross discount. Having been in the retail world, not all sales and transactions make complete apparent sense. Here, J.D. could be happy to see the figures on new rigs inch up and the dealer may be happy to get their hands on lightly used tractors they have buyers for.

Don't know, but it's hard to believe the dealer could offer this deal (apparently over and over with all kinds of exposure) and not follow through on it. That said, tractor dealers have some of worst reputations when it comes to consistent agreements and following through with what they've said.

 

[North Country]

I could see that if they took in model A,B or C used and gave away a new model X.

But they're taking in used model X's and giving away new model X's - that's what's really odd about this one.

 

[Chilly807]

It may simply be a case of a new salesman wanting to build a customer base, making next to nothing on the deal.

Or, he has a customer that refuses to buy new for whatever reason, and wants a "good used 2520". Some folks have the mind set that they always lose when buying new. That would account for the replacement of old implements with new. Sometimes old gear IS better than new, in terms of material quality and the amount thereof.

If he's selling the used 2520 to a cash customer, 0% financing makes little difference in today's world of poor interest rates on investments.

I looked at used tractors for a couple of years before buying new, it soon became clear to me that used wasn't much of a savings, unless I wanted to buy 10 year old or older machinery. Three year old tractors carried a sticker price of less than $3000 difference from new.

There are often two distinct types of customer, those that buy only new, and those that buy only used. I think the salesman has one particular customer that's willing to pay close to full new price for your tractor, refuses to buy elsewhere, and is more comfortable buying from a dealer. More "money than brains" comes to mind, but whatever makes 'em happy.

If that particular dealership has a 2520 they'd like to move, and are willing to cut their profit to the bone to do it, they increase their customer base at the same time. It's a calculated risk, long-term return approach to business, maybe aimed at getting into a market they feel will serve them.

I doubt JD would do that across the board, no sane manufacturer would put themselves in that position unless it showed a larger "+" on the bottom line.

Sean

 

[MESSMAKER]

He would be losing at least five grand on that trade. It just sounds too good to be true.

 

[Markcuda]

5 grand you say?