Warranty Work on New Tractors

[MessickFarmEqu]

Conversations between dealers and mfg's about flat rate have happened since the dawn of time. Its not isolated to any particular company, they all do it. Apparently they say its possible to meet the times, but its assuming that everything goes perfectly, no bolts strip, the machine is not covered in cow crap, you've got the tools inhand etc, etc. Its based on a senerio that does not exist in our business.

 

[Dargo]

Several years ago when JD told me that "there is no market for cabs in the CUT sized tractor", I decided to go to Kubota. Prices were too high (in my mind) at my local dealer so I saved almost 3K by buying one about 2 hours away in a different state. When I had a loader issue I called my local dealer to see if he wanted to work on it or if I needed to take it back where I bought it. To my surprise he not only said he'd be happy to work on it, but also came to pick it up and delivered it when fixed.

Since then his pricing has been "close enough" to other dealers so I've probably spent 100k with him since then. His good will towards me after trying for the big profit that first time has resulted in a mutually beneficial relationship. Even when the cabs proved too small for me in Kubota's M class tractor, he seemed to understand why I bought another brand and I hear nothing about it when I have my Kubota machines in for service. He only asks if he can have a shot at my next tractor purchase. I assure you that I will give him the first shot to fill whatever my needs may be when the time comes. Heck, he's already telling me about the new RTV1140 units that are going into production even though my RTV1100 is only a year old. That's fine with me and just good salesmanship in my book.

 

[Farmwithjunk]

I would love to hear a few more dealers weigh in on this thread. Reason being, the nearest John Deere dealer is sending out mailers advertising their desire to take all Deere warranty work regardless of where the tractor was purchased. There are 2 Deere dealers in the immediate area and 4 more with-in an hours drive. I realize they'll land a few customers long term by going after the warranty work, but if it was a losing propostion, I doubt they'd be so aggressively targeting the business.

I'd like to hear from a Deere dealer and an AGCO dealer in particular.

 

[RickB]

I would love to hear a few more dealers weigh in on this thread. Reason being, the nearest John Deere dealer is sending out mailers advertising their desire to take all Deere warranty work regardless of where the tractor was purchased. There are 2 Deere dealers in the immediate area and 4 more with-in an hours drive. I realize they'll land a few customers long term by going after the warranty work, but if it was a losing propostion, I doubt they'd be so aggressively targeting the business.

I'd like to hear from a Deere dealer and an AGCO dealer in particular.

I have about 15 years of Ag dealership experience, mostly with a New Holland store, some with a CaseIH store prior to the NH buyout. I can tell you that everything Neil has posted about warranty work in the Ag/CUT sector is true based on my experience. Flat rate times are generally a joke, unless the manufacturer has a PIP, campaign, or recall involving the possibility of personal injury on the part of a customer. That is one of the few times a dealer can consistently make flat rate times because it is in the manufacturer's best interest to get to a 100% completion. With standard warranty work, the manufacturer's best opportunity to escape responsibility for a parts failure is to be shy on labor allowances to replace the part. Comparing warranty practices in the auto industry and the Ag/CUT equipment industry is apples and oranges for many, many reasons, most significantly the structure of flat rate schedules as they compare to the real world.

I haven't responded in this thread before now because the topic has come up here before with similar opinions and replies. It seems to be a topic that many members here have preconcieved notions on and it is a topic that gets volitile quickly. This response is specifically for FWJ, who asked to hear from dealership personnel.

 

[WilliamBos]

I have about 15 years of Ag dealership experience, mostly with a New Holland store, some with a CaseIH store prior to the NH buyout. I can tell you that everything Neil has posted about warranty work in the Ag/CUT sector is true based on my experience. Flat rate times are generally a joke, unless the manufacturer has a PIP, campaign, or recall involving the possibility of personal injury on the part of a customer. That is one of the few times a dealer can consistently make flat rate times because it is in the manufacturer's best interest to get to a 100% completion. With standard warranty work, the manufacturer's best opportunity to escape responsibility for a parts failure is to be shy on labor allowances to replace the part. Comparing warranty practices in the auto industry and the Ag/CUT equipment industry is apples and oranges for many, many reasons, most significantly the structure of flat rate schedules as they compare to the real world.

I haven't responded in this thread before now because the topic has come up here before with similar opinions and replies. It seems to be a topic that many members here have preconcieved notions on and it is a topic that gets volitile quickly. This response is specifically for FWJ, who asked to hear from dealership personnel.

And this is one more thing to think about if considering applying for a dealership. You want to sell a quality product(s), or else you could take a bath on warranty work if the product is low quality, with high warranty claims.

 

[Farmwithjunk]

I have about 15 years of Ag dealership experience, mostly with a New Holland store, some with a CaseIH store prior to the NH buyout. I can tell you that everything Neil has posted about warranty work in the Ag/CUT sector is true based on my experience. Flat rate times are generally a joke, unless the manufacturer has a PIP, campaign, or recall involving the possibility of personal injury on the part of a customer. That is one of the few times a dealer can consistently make flat rate times because it is in the manufacturer's best interest to get to a 100% completion. With standard warranty work, the manufacturer's best opportunity to escape responsibility for a parts failure is to be shy on labor allowances to replace the part. Comparing warranty practices in the auto industry and the Ag/CUT equipment industry is apples and oranges for many, many reasons, most significantly the structure of flat rate schedules as they compare to the real world.

I haven't responded in this thread before now because the topic has come up here before with similar opinions and replies. It seems to be a topic that many members here have preconcieved notions on and it is a topic that gets volitile quickly. This response is specifically for FWJ, who asked to hear from dealership personnel.

I appreciate your reply. This makes me wonder what the angle is with the Deere dealer who's so actively pursuing the warranty business. (other than possibly squeezing out all their competition in the area)

 

[WilliamBos]

I appreciate your reply. This makes me wonder what the angle is with the Deere dealer who's so actively pursuing the warranty business. (other than possibly squeezing out all their competition in the area)

Bill,

From what I understand Deere & Co is looking for 1 owner multiple dealerships. Could this be the beginning of this in your area??

 

[Farmwithjunk]

Bill,

From what I understand Deere & Co is looking for 1 owner multiple dealerships. Could this be the beginning of this in your area??

That's already a done deal for the most part. The dealer I'm referring to has 3 other outlets, is marketing themselves as a "John Deere SuperStore", and has almost all of the AG market in this area wrapped up. The other nearby dealer specializes in industrial/forestry/turf (golf course equipment) . Of the dealerships with-in an hours drive, one is owned by the "big box" dealership just up the road. Others are well established high volume multi-outlet dealers in their own right.

 

[RickB]

I appreciate your reply. This makes me wonder what the angle is with the Deere dealer who's so actively pursuing the warranty business. (other than possibly squeezing out all their competition in the area)

Are things slow there, or are there expectations that things are going to get real slow for them? In this economy, even warranty work pays better than pushing dust around with a broom. If they have good techs that they want to keep, they need to be busy doing something. This analysis has been comparing warranty work to the typical external work order, although not in so many words. In some markets, those are getting fewer and fewer.

 

[Twotone]

I was a service manager at a car dealership in northern Mn. 20 years ago, and more often than not warranty times are a joke. I fought with factory rep's over this issue many times. I would tell them they were dreaming only to be told "a man's gotta have dreams".

As RickB said, the only time we could consistantly make time was when performing a campaign (recall). Diagnosis was a killer at times, especially electrical.

My oldest son is a tech at a JD dealership and tells me they don't do much warranty work at all, but when they have to send out a tech in the service truck to fix a combine broke down in a field, is has to be costly to the dealer.

Cars and tractors are apples and oranges, and I'll be the first to admit I know nothing about running a tractor shop, but there has to be some similaritys like stress, headaches, and so on. That's why I got out of it.

Tom