Kubota Depreciation

[Kelvin]

I'm trying to get a reality check on advice I gave someone.

A couple of weeks ago there was a gentleman interested in buying a new Kubota (his first tractor) and asked me how the depreciation was. I really didn't put a lot of thought into it, and gave him this short-notice answer:

Tractors, like the automotive industry, take a pretty good dip when you drive them off the lot. With tractors, the main reason is that very few people would be interested in buying used when they could buy the same tractor new, with full warranty, for just a little more. However, Kubotas (and probably other makes as well), don't really depreciate much beyond the initial drop if they are taken care of.

While doing a lot of shopping for my Kubota, I found that 10 to 20 year old Kubotas in good shape under 1000 hours frequently sold for the same or even higher dollar amount as they were initially purchased (not counting inflation).

I then summarized by saying that if he bought a $15,000 tractor new, the bad news would be that the value would probably drop almost immediately to the $13,000 range, but the good news is that it would stay there for years to come.

Again, these comments were made based upon my shopping experiences. Other opinions requested. I was motivated to go ahead and make this post after observing MrP's efforts to sell his nearly new L3410HSD.

Kelvin

 

[Thomas]

Thats a tough one to try and answer.

Maybe its do to the fact that tractor owners are taking much better care of there investment $$$,which means better trade in sales or privite sales are higher.

Second hand 4wd tractors in good plus shape do sell a lot higher than when purchase 5 to 10 years ago..maybe its do to demand and supply.

 

[MrP]

Kevin,

I agree with your assessment of a $2,000 depreciation. I am confident that I could sell it for $2,000 less than the cost new if I had a FEL. When I put an add in the paper, I got 15 call on it in one weekend. Unfortunately, 14 of the calls wanted a FEL. The one person who didn't want a FEL wanted a garden tractor to maintain 1+ acres. I told them to call Sears.

Just for the record, my tractor is 3 years old, I just don't get to use it much now that the land is fenced and the horses are grazing. But it does look good in my garage.

Now that I have decided to put a FEL on the tractor, I've been going on a buying spree in my mind. If I had the funds to buy the implements I want, I'm sure I could get some more seat time this year. I doubt that the wife would go for it. Come to think of it, the checkbook wouldn't go for it either.

Shameless Plug: If you are interested in my L3410, make an offer now, cause in two weeks, it will be off the market.

 

[Charliebrn]

you know, I hadn't really thought of depreciation vs saleability without having the FEL as part of the deal. You may be right though....perhaps the market can change drastically if you don't have one. Last year I sold my fathers L2900 with 600 hours on it for 13,000. Took me a whole week to sell it. Of course, it had the FEL, too.