How hot is the CUT competition getting these days?

[RoyJackson]

Deere knows their growth is in the Cut and under market...the AG market will continue to shrink...they will not in way be getting out of the Cut market.

Well, there's a Deere dealer...and I reckon he'd have a better idea of Deere's future then I would...
We shall see!

But, why is the Ag market shrinking?

 

[jbrumberg]

My theory is that the largest (i.e. corporate owned) farms are getting larger through more land acquisition, and the smaller (family) farms are being parceled out into smaller land plots. There must be a point of "diminishing return" for equipment on the larger farms not including equipment replacement. The owners of the new smaller land parcels will need the SCUT's and CUT's. Just my theorizing this early morning . Jay

 

[Double Orange]

In the 9 yrs. I've owned a farm here in this county, I've noticed that every time a spouse [usually the husband] passes away their farms are sub-divided into 5 to 20 acre parcels. The $$$price of land here has gone up so much that no young family could afford to start a family farm bussiness. The last estate sale here 240 acres w/ a 1930's farm house, and a smalll stream sold to a developer for $2,875,000.00. So I would have to agree the market for 30+ hp cut is alive and well. I know farmers who have sold their land and pocketed some serious $$$'s and have taken up building trades ie carpenters/plumbing etc. work 1/2 as much and laugh all the way to the BANK !!

 

[MessickFarmEqu]

In times past competitors have come and gone and the big three have remained.

Do those of you that have seen other brands come and go over the years see (or not see) something different with the current stream of what seems to be worthy competition, than it has been with brands that have gone in the past?

Given my short experience following CUTs, it appears to me that the big three are going to experience a sizable drop in new market share in the coming years. Consumers should benefit as increased competition generally results in lower prices. I'd also like to hear opinions from those that have watched this for a much longer time and seen new and exiting brands come and go.

You need to put things in perspective some. The total market impact of the minor brands is only about 10% of the CUT market, thats it. Even well reconized brands on this website only sell a few hundred tractors a year. Competition is good for everyone, and we are at a point where there are probably more minor players than ever before. This is largly because we've had a solid 10 years of either growth or a flat CUT market. The next softening or downturn will surly see some of these companies fold or pull out of the US.

I think the cub/yanmar thing is a genius decision. If cub's L&G dealers step up and aggressivly sell that line we all maybe surprised.

 

[daTeacha]

Getting back to Cub Cadet/Yanmar, I just hope for the sake of a grand old name that the things are better than some of the larger Cadets of the recent past. The line with the Yamaha V-twin gas engine as one of the choices just never seemed to catch on. The older lawn tractors command a premium at auctions, but the newer ones are more or less held in the same regard as the many other MTD products you can find, and the CUT size simply isn't to be found despite the fact that there are dealers around. They just don't move many units. I don't think Cub Cadet did themselves any favors when they started selling Cadets at the bigbox stores. Deere did the same thing with their Sabre line but saw the light and pulled the plug. Cub should do the same and go back to being a servicing dealer only product.

 

[RoyJackson]

Roy - I thought I liked your new sig but then I realized that it was telling me that my hydrostat and horizontal exhaust on my L3400 was symbolic of a "girlie" man!.

Hahahahahahahah...was wondering how long it would take...
It was actually in response to a post about Deere putting the 790's stack under the hood

 

[aesanders]

I wouldn't be surprised to see Deere abandon this market, ultimately...especially for the residential buyers. I believe their corporate mentality is directed toward larger ag equipment.
.

I couldn't disagree more towards the above quote. In my opinion, Deere will focus more and more on this segment. The large AG divisions have no growth potential. Heck their is only 3 main competitors in Deere, AGCO and Case/New Holland. If anything I see them pushing their commercial brands like Backhoes and Skid loaders more than the larger Ag machines, but they will not abandon the smaller cut lines. I've been seeing more of the AGCO challenger tractors now for road maintainance crews. I mostly see Deere, Kubotas and New Hollands for this, but have been seeing more of the AGCo's recently.


In my mind you will see the larger companies getting more agressive and driving out the smaller companies.

So in 15 years I expect to see Deere, Kubota, New Holland, Agco, Mahindra as being the common CUT manufacturer's with maybe another one or two comapnies and some new up starts. Kioti and the new Cub Cadet/Yanamrs could make a play to be with the above group as well. Companies like Montana and Tym maybe still around or could just as easily blow away.

 

[canoetrpr]

. Even well reconized brands on this website only sell a few hundred tractors a year.

WOW!. I would have thought it would be in the thousands.

 

[canoetrpr]

So in 15 years I expect to see Deere, Kubota, New Holland, Agco, Mahindra as being the common CUT manufacturer's with maybe another one or two comapnies and some new up starts. Kioti and the new Cub Cadet/Yanamrs could make a play to be with the above group as well. .

Interesting that you put Kioti behind Mahindra. Not sure what it is like in the USA but here Kioti is quite a bit further ahead on their dealer network than Mahindra. Mahindra is virtually unknown at least where I am - probably 1 dealer within a few hundred km.

Kioti on the other hand has two dealers within about 45 min. One of the two I visited was better than any other Kubota or Deere dealer that I've talked to around here so it seems like they are paying attention to who they franchise to.

 

[Toolguy]

I would think that CUT an S-CUT sales would mirror the real estate market. Right now real estate sales are down. With fewer new owners of suburban homes and land it should translate into fewer buyers of small tractors. Kubota and John Deere, with NH coming in a distant third, are the most recognizeable names and thus appeal to the homeowner that wants to make a "Statement" in his neighborhood. Also, most people with the money to buy a new CUT want to buy a quality brand name product that will have good resale at some point. I think the market for the "other" brands will shrink before it grows. It will be tough to take market share away from the big 3 unless the "others" are substantially lower in price to offset their less recognizeable brand names. When the economy picks up again (and it will) you will see a few more tractors from the others. Just my .02.