New Tractor Sales Are Declining

[MinnesotaEric]

Some useful public data on 1100 OPE dealers is published by Constellation here: OPE Market Data - Constellation Dealership Software

This data shows sales flat with 2022, which I think indicates a good start to the year in light of when the down months happened in 2022. Keep an eye on this data for the next few months to see if we're going to be up or down this year.

Meanwhile, manufacturing is slowing globally, largely because the global population is continuing to age and young families drive demand, Germany is in recession, increased Saber-rattling between Major-Powers is disturbing, Europe's stupid energy policy is crippling a recovery, China still needs to import food and energy, but its labor now costs three times as much as Mexican labor, our largest trading partner, we are heading into recession, and I think we'll eventually see the Dow dip below 20K after a fight at support for the lows in March 2021.

Oh, and new real estate mortgages are at 28-year lows, our investment class is not buying real estate and the shiller index is down over 20% from their highs in some parts of our county.

The bright news is I'm still pricing $350K and under homes like it is July 2022 because of demand and thanks to Mexico and our Gen Xers having some children, we get a bye and get to watch the rest of the world suffer more than ourselves.

 

[CloverKnollFarms]

I’m just waiting to see how many more banks fail…

 

[TN8Man]

Meanwhile, manufacturing is slowing globally, largely because the global population is continuing to age and young families drive demand, Germany is in recession, increased Saber-rattling between Major-Powers is disturbing, Europe's stupid energy policy is crippling a recovery, China still needs to import food and energy, but its labor now costs three times as much as Mexican labor, our largest trading partner, we are heading into recession, and I think we'll eventually see the Dow dip below 20K after a fight at support for the lows in March 2021.

Oh, and new real estate mortgages are at 28-year lows, our investment class is not buying real estate and the shiller index is down over 20% from their highs in some parts of our county.

The bright news is I'm still pricing $350K and under homes like it is July 2022 because of demand and thanks to Mexico and our Gen Xers having some children, we get a bye and get to watch the rest of the world suffer more than ourselves.

Don't forget the global move to exit the petrodollar system with the formation of BRICS (Brazil, Russia, India, China and South Africa).

 

[TN8Man]

I’m just waiting to see how many more banks fail…

Its starting to look like just the beginning.

 

[bridge4]

0% on Kubota and Bobcat, I'm sure others. That's a great indicator imo. If sales were like they were two years ago we'd be seeing more 3-5%. Offering 0% when bank rates are 4 and moving...

I hope they are still going this summer, might finally grab a mini-ex or skid steer.

 

[Yander]

It might be 0% interest but from what I'm seeing on their websites for equipment costs they're making it up by charging more for equipment. I'm guessing it is a marketing ploy.

"Hey let's have 0% interest in an economy where the interest rates are going up but charge more for our tractors."

I'd be curious to see what a cash buyer can get one of those tractors for that are overpriced.

 

[Hay Dude]

Kubota has 5.75% on used Kubota tractors.
There’s an M7-151 I can get locally, but the asking price, even with the reasonable used equipment financing is just too much.
Between rising equipment prices and high interest rates, I’m slowly being priced out of the market.

 

[bridge4]

It might be 0% interest but from what I'm seeing on their websites for equipment costs they're making it up by charging more for equipment. I'm guessing it is a marketing ploy.

"Hey let's have 0% interest in an economy where the interest rates are going up but charge more for our tractors."

I'd be curious to see what a cash buyer can get one of those tractors for that are overpriced.

It says 1600 or 0% financing on one of the ones I was looking at yesterday. Obviously they did the math and figured its the same to them as a company, but as a buyer it isn't. I agree though, things haven't gotten any cheaper in a real sense.

Kubota has 5.75% on used Kubota tractors.
There’s an M7-151 I can get locally, but the asking price, even with the reasonable used equipment financing is just too much.
Between rising equipment prices and high interest rates, I’m slowly being priced out of the market.

This might be why the sales are declining! Lots of saving money being spent these days on essentials.

 

[Hay Dude]

It says 1600 or 0% financing on one of the ones I was looking at yesterday. Obviously they did the math and figured its the same to them as a company, but as a buyer it isn't. I agree though, things haven't gotten any cheaper in a real sense.


This might be why the sales are declining! Lots of saving money being spent these days on essentials.

A used farm tractor that was $55,000 is now $75,000. The used sellers know new tractors are only affordable to BTO’s and the smaller-mid farmers are stuck with mostly used.

Don’t know how this all ends, but my guess is soon we will be buying all our food from maybe 5 companies, banking at 5 banks, medicine from 5 companies, etc.

No country for small business people!

 

[Yander]

Yeah it's not trending well at all.

I've seen people on this thread try to compare today's economy to that of interest rates and economy 25 - 30 years ago.

It's not the static (point in time) comparison that I'm concerned about it's the trend that we're in.

 

[Hay Dude]

Yeah it's not trending well at all.

I've seen people on this thread try to compare today's economy to that of interest rates and economy 25 - 30 years ago.

It's not the static (point in time) comparison that I'm concerned about it's the trend that we're in.

Throw into the mix the current climate of economic catastrophe, funding a war with Russia and spending all this money and it all looks very bleak.

 

[52farmer]

I am currently shopping,new and used.The new prices are staggering but so are the used.Made a offer yesterday on a 5 year old tractor ,the guy wouldn’t even counter and he has had it for sale since last July.

 

[BleedingOrange]

I laugh at all those that think zero percent interest is free.
Figure out this puzzle, zero percent interest, or 5000 dollars off.
Unfortunately now the sellers are not offering the 5K off any more, but trying to make even the cash buyers pay the hidden interest.
I,m finally starting to see private sellers adds which states they cann,t afford to make payments any more. Unfortunately, a lot of those sellers are upside down on their loans, so they are going to take a financial beating if they want to get out of them.

 

[2manyrocks]

I was talking to a guy yesterday who had a nice compact track loader and drum mulcher that he used to clear the farm next to mine last year. He said he used a leaf blower to blow out the debris from his CTL every three or four hours, but he was doing another job later in the year where he saw a fire start in the machine. Thought he had it put out with a fire extinguisher, but the fire came back and burned the whole thing. He thought it might have been caused by the emissions system that he said ran cherry red hot while in operation. When he looked at replacement equipment, it was going to be $175K, but all he could find was used stuff that people were asking new prices for. So he didn't replace his equipment.

I've been considering buying myself, but have reservations about the cost. After hearing that his machine may have caught fire because of the heat from the emissions system and debris from mulching, that put the nail in the coffin for me. The cost itself is bad enough, detest the emissions system, but heck if the emissions system may cause my investment to go up in flames, no way.

 

[CloverKnollFarms]

Its starting to look like just the beginning.

Hens are coming home to roost. All a predictable outcome of easy monetary policy and spending more money in the past several years, than in our entire history prior to. Interesting times

 

[Hay Dude]

I was talking to a guy yesterday who had a nice compact track loader and drum mulcher that he used to clear the farm next to mine last year. He said he used a leaf blower to blow out the debris from his CTL every three or four hours, but he was doing another job later in the year where he saw a fire start in the machine. Thought he had it put out with a fire extinguisher, but the fire came back and burned the whole thing. He thought it might have been caused by the emissions system that he said ran cherry red hot while in operation. When he looked at replacement equipment, it was going to be $175K, but all he could find was used stuff that people were asking new prices for. So he didn't replace his equipment.

I've been considering buying myself, but have reservations about the cost. After hearing that his machine may have caught fire because of the heat from the emissions system and debris from mulching, that put the nail in the coffin for me. The cost itself is bad enough, detest the emissions system, but heck if the emissions system may cause my investment to go up in flames, no way.

Buy a pre-emissions piece.
That’s what I have done so far.
If you look hard, there are still some private sales that are reasonable.

I may buy my first emissions tractor because the choices for pre emissions are getting thinner with each passing year, and you are right, prices are crazy high

 

[Williy]

Don't know if this is true or not but I heard that
the silicon bank gave all employe's a hefty pay
bonus just before they went belly up!

willy

 

[rScotty]

I was talking to a guy yesterday who had a nice compact track loader and drum mulcher that he used to clear the farm next to mine last year. He said he used a leaf blower to blow out the debris from his CTL every three or four hours, but he was doing another job later in the year where he saw a fire start in the machine. Thought he had it put out with a fire extinguisher, but the fire came back and burned the whole thing. He thought it might have been caused by the emissions system that he said ran cherry red hot while in operation. When he looked at replacement equipment, it was going to be $175K, but all he could find was used stuff that people were asking new prices for. So he didn't replace his equipment.

I've been considering buying myself, but have reservations about the cost. After hearing that his machine may have caught fire because of the heat from the emissions system and debris from mulching, that put the nail in the coffin for me. The cost itself is bad enough, detest the emissions system, but heck if the emissions system may cause my investment to go up in flames, no way.

Now let me get this straight..... This guy was using a leaf blower to force air across mulch debris on the tractor while the machine it was still hot, it caught fire, and he blames the emissions system?
Does something seem wrong with that picture to you?

rScotty

 

[rScotty]

Don't know if this is true or not but I heard that
the silicon bank gave all employe's a hefty pay
bonus just before they went belly up!

willy

When I hear "true or not", I just sort of automatically assume "not".

 

[CloverKnollFarms]

Don't know if this is true or not but I heard that
the silicon bank gave all employe's a hefty pay
bonus just before they went belly up!

There were also a lot of withdrawals from important people from a certain political party There was a list published yesterday with amounts.