Financing Do Kubota incentives last through buying process?

JOHNTHOMAS · Dec 29, 2017

fishpick said:
By Kubota Finance running their incentive program this way - the dealer has to take the risk by getting in line for a tractor and then hoping the incentive is available when it shows up at their place and the customer will sign on the dotted line for it.
I said it before - and I'll say it again - they should probably take note of how other business do "special offer financing" and maybe learn some things.

The dealer takes "no risks" other than losing their profit margin on the sale if you walk away and didn't leave a deposit. The machine is and will be Kubotas until it is sold. The dealer has no money in the pot. Your right that Kubota Company should have a solution for this "problem" which I'm sure comes up from time to time.
Tractors don't have "titles" like cars/trucks and can be "dislocated" easier around the country by dishonest (Thieves) people and creates different financing and insurance issues and concerns which may be the fly in the ointment.

fishpick · Dec 29, 2017

@Garandman - I'm not "really" that concerned - I think the likelihood of them dropping the 0% for 84 months is minimal - but it's silly that they hamsting the buying process at a quarter rollover... 4 times a year they make it more difficult than it needs to be. They control the financing - all they need to offer is a commitment letter - sign on the line - rate lock - whatever you want to call it... problem solved.

@Goldnrod24 - "she looked cute"

@JOHNTHOMAS - your comment about no dealer risk can not be 100% accurate - because if it was - any given dealer would carry at least one of every make and model of every current tractor if there was not financial impact to them carrying inventory on the their lot. I'm pretty sure they own said inventory - which costs them money that they are now NOT going to collect on a sale that's lost because financing terms changed mid-deal and the buyer walked away.
As to the "no title" - yeah - that makes things that cost more than a car but less "trackable" a long game challenge for the bean counters, for sure!

JOHNTHOMAS · Dec 30, 2017

fishpick said:
@JOHNTHOMAS - your comment about no dealer risk can not be 100% accurate - because if it was - any given dealer would carry at least one of every make and model of every current tractor if there was not financial impact to them carrying inventory on the their lot. I'm pretty sure they own said inventory - which costs them money that they are now NOT going to collect on a sale that's lost because financing terms changed mid-deal and the buyer walked away.
As to the "no title" - yeah - that makes things that cost more than a car but less "trackable" a long game challenge for the bean counters, for sure!

Hate to dispute your words but your wrong. The new Kubotas are owned by Kubota, the used tractors are owned by the dealers. I'm certain any dealer can not order all the Kubotas they want. I'm sure they can order what their sales volume proves they can likely sell and the machines Kubota wants to introduce to the public. I think you keep wanting to relate tractor sales companys with car/truck dealers which you may have experience with but obviously you've never been in the new tractor business. You do know there are several Kubota dealers that are members and follow the posts on TBN and will dispute false/wrong information, don't you? [/SIZE]

fishpick · Dec 30, 2017

Yup - I知 aware of members here and I respect a lot of their opinions.
And you don稚 seem to be a dealer based on your bio.
Thanks tho!

Happy New Year

Clint S · Dec 30, 2017

Am basing this on my limited knowledge, but the dealers have to sign a contract with said company about inventory. The contract usually states the dealer has x amount of months to move a unit. If the dealer does not move a unit in said amount of time they usually have to start paying some sort of payment on it. The longer a unit sits the more stake the dealer has in it and the harder they will push to move it. Again just my very limited expeience

Peter 315 · Dec 30, 2017

Kubota owns the machines and they are on a floor plan. Dealer pays interest every month until the note is due. A Company comes in every month to check inventory to make sure sold machines are paid for.

fishpick · Dec 30, 2017

Thanks Peter 315 - so - it costs the dealers to have a unit unsold on hand. Maybe not inventory cost - but interest against loaned units.
That makes way more sense!

downslope · Dec 30, 2017

Peter 315 said:
Kubota owns the machines and they are on a floor plan. Dealer pays interest every month until the note is due. A Company comes in every month to check inventory to make sure sold machines are paid for.

This sounds exactly the same as how auto dealer financing works. Enforcement methods may be somewhat different however. If inventory discrepancies are found at a new car dealership they are likely to be considered out of trust and the manufacturer will confiscate all the MCO/MSO's.

bluelou212 · Dec 30, 2017

Peter 315 said:
Kubota owns the machines and they are on a floor plan. Dealer pays interest every month until the note is due. A Company comes in every month to check inventory to make sure sold machines are paid for.

Why does the dealer pay interest if Kubota owns the machines? That doesn't sound right. I'm going to guess that this works more like other types of asset backed financing. The _dealer_ owns the machines, Kubota or a third party finances the inventory, and the inventory loan is 100% collateralized by the encumbered asset, so the equipment is a restricted asset of the dealer.