Dealers how are sales during this tough time

[deere755]

I have spoken with a friend who owns a couple of convience stores and a friend who has a car dealership and they both say sales are down as every other business right now. The friend in the car business says used sales are stonger then new sales but still down from normal.

So my question is for tractor dealers. How are your sales now with the economic crunch? Is there a demand for used versus new? Are there more incentives to try and move new equipment such as rebates, 0% interest, etc.? Has the value of good quality used equipment went up?

 

[MessickFarmEqu]

From what we've been hearing there is a broad spectrum of how places are doing. A dealership that is very bound to consumer and/or construction products is struggling more than those who are more AG based. We're hearing most MFG's down 10-20% with things like compacts, but utility and farm tractors/implements are up and selling very well. Skid Loaders have totally taken a dive. Deere and Bobcat have both shut down and laid off workers at their SSL plants. 2-3 of the small ZTR companies are on the rocks. One major implement company is not faring well. If this recession lasts there is no question we'll see several smaller companies close up shop. It won't be a surprise, there are dealers and MFG's who have not been sound even during the good times.

As for produt, there is lots of used stuff available now, more than I can recall in the last 5 years. People are not plunking down $20,000 for a nice clean used tractor. Most are choosing to finance. The 0% programs are out there, most companies have thrown more money at that and they have gotten better. We don't have may issues with getting loans, but the standards for credit have gone up.

When things get tight, it creates some buying oppertinuties for those with cash. Now is a good time to buy a tractor. I just bought a new car last week. I'm not a new car buyer, but its clear the MFGs are very hungry for sales. I paid less for a new Saturn than I did for my wife's used Toyota with 35,000 miles... I'll now hope that GM is around for a few more years .

As for us, we'll be about flat this year. I think anyone would be happy with that! December is a big time for guys buying for tax reasons. The next 30-days will be the biggest sign of whats to come.

 

[Bird]

The friend in the car business says used sales are stonger then new sales but still down from normal.

Prestige Ford, Garland, Tx, has long claimed to be the #1 seller of Ford pickups in the USA. And I recently saw a news article that they're doing some remodeling to concentrate more on the used vehicle sales along the lines of Carmax.

 

[ramoffroader]

I talked to my TYM dealer yesterday. Says his major problem is not selling tractors but getting people financed. With the banking industry in its current state they are not loaning alot of money to consumers. He told me he had a father and son come in to buy two tractors. The father got financed and the son did not.

 

[deere755]

I talked to a guy this evening who bought a new Case IH utility with a loader, 5 years no interest. That is a great deal. I have been pretty green all my life but that sounds very tempting.

 

[Farmwithjunk]

I'm shopping for two 100hp tractors for the mowing business. This is DEFINATELY a good time to be a cash buyer. I've got a couple dealers virtually fighting each other for my business.

 

[radman1]

I expect the large hp farm tractors to start decreasing significantly in sales. Price of corn, soybeans etc, is less than half of the peak in the spring and early summer. Couldn't find a new 180+ hp tractor earlier this year and now I am seeing them at multiple dealers. Some of them are lease returns. My brother ordered a Case-IH MX245 (245hp). Wasn't suppose to be delivered until March 09 but arrived at the dealer 2 weeks ago.
As a side note, farm land prices in my state increased 28% this year. Farmers are going to get in over their head with high land prices.

 

[Farmwithjunk]

As a side note, farm land prices in my state increased 28% this year. Farmers are going to get in over their head with high land prices.

If you're old enough to recall the AG economy of the early '80's, you'll see a familiar trend now. If you AREN'T old enough to remember, just watch and you'll see why many talk of the '80's with such distain.

 

[radman1]

If you're old enough to recall the AG economy of the early '80's, you'll see a familiar trend now. If you AREN'T old enough to remember, just watch and you'll see why many talk of the '80's with such distain.

Yes, I am old enough to remember. Lots of farms were lost then. However, the interest rate then was in the 13-15% range. When the land prices fell, the high interest rates killed off the farmers as well as many smaller banks who loaned the money.

 

[RickB]

Yes, I am old enough to remember. Lots of farms were lost then. However, the interest rate then was in the 13-15% range. When the land prices fell, the high interest rates killed off the farmers as well as many smaller banks who loaned the money.

See where interest rates are 12-18 months from now.