New vs. Used

[rozett]

I understand the issues that folks have brought up about buying used.... I have a different experience. While I have bought several new autos, I am philosophically opposed to buying new. I generally buy a 1 to 2 year old car, letting someone else pay for the depreciation. This has worked very well for us for almost 20 years. In '89, I bought an immaculate Ford Crown Vic with 11k miles. I sold it years later with 256K miles, with nothing but normal maintenance and the usual consumables (brakes, etc.) Every vehicle since then has been no more than 2 years old. And all have been excellent performers.

I did the same with my Cub. I did all the up front research and decided exactly what model I wanted. I took advantage of the difference in prices between the northeast (high) and the southern US. I bought a 1 year old machine with 92 hours. It has been an excellent purchase and was $6k less than the local dealer wanted for a new one. It has never had the need to go to a dealer for service and I have done little more than normal preventative maintenance. If you need it in a hurry, I agree that buying new may be faster. But you have paid (dearly) for that time.

 

[To20Chris]

Mark,

You are right, I wanted the tractor primarily for what it can do, which is not to say that I don’t enjoy using it or working on it. I just could never justify it financially for those reasons.

As far as renting - I would have to do a lot of jobs to justify the Kioti directly, as opposed to renting, but then of course I will still have a tractor when I'm done. And since it is here, I will do more jobs with it than I would if I had to rent it. The sum of these improvements will increase the value of my property, although I can't credit all of that to the tractor, as there will be materials too (and that time thing again!). I may yet pay back the Kioti in property value, or at least in avoided payments for projects I would have had to do anyway. At 27hrs, it has already earned back a couple of grand, based on actual estimates I had. I won’t keep that pace up, as those jobs were banked up, but it will work for a living.

Perhaps I left the wrong impression - I could never support the property, equipment, vehicles, etc. I have now if I didn't do most of my own maintenance. It is precisely because at times fixing things has gotten so overwhelming that I have begun to look for ways to cast some of that off. Property appreciates while most equipment rarely does, so if you are spending your time working on the tools instead of using them you may be loosing financially. Also, I found that it took a long time to accumulate enough tools and supplies (and knowledge?!) so that I could actually get something done when I needed to. What a pain when you are one fitting shy, don’t have quite the right tool, etc., and now you have to spend you time driving out to get it. So when I need some tool for a particular job, I try to consider if I will ever need it again, and if so I’ll consider paying more so that I’ll have it ready next time. The tractor is like that, only multiplied many times!

Don’t take this wrong, because the Kioti was a MAJOR investment for me, but my point of view is that it is at least possible to get more money, but getting more time - well, it’s kind of hard to make more of that!

If what you want to do is work on tractors, then for sure don’t get a new one – there are so many neat old machines out there. For people who need to use at tractor, some will find the right used machine that suits their needs, and they will really make out, having skipped the depreciation.

Maybe someday I’ll have enough spare time to restore the Ferguson, which would be quite enjoyable if I could work on it at my own pace!

 

[Brian_Stephens]

</font><font color="blue" class="small">( I did the same with my Cub. I did all the up front research and decided exactly what model I wanted. I took advantage of the difference in prices between the northeast (high) and the southern US. I bought a 1 year old machine with 92 hours. It has been an excellent purchase and was $6k less than the local dealer wanted for a new one. It has never had the need to go to a dealer for service and I have done little more than normal preventative maintenance. If you need it in a hurry, I agree that buying new may be faster. But you have paid (dearly) for that time. )</font>

Well that is great for you but that assumes that everbody can find a one or 2 year old item in the area that they are looking for and can arrange the financing and that the cost of transportation doesn't kill the deal. I'm looking at a new tractor and going why wouldn't I buy new... I get a full warranty in case anything does go wrong and right now they are offering 5% financing.. The bank won't give me any better then about 10% and Farm Credit is 13%....

I'd been looking for a deere for about 6 months.. we found what we were looking for out of province and couldn't finance it becuase it was out of province.. So I'm restricted to Ontario even so you figure I'd find what I was looking for at a good price once in a while... Well I don't go to vegas for the very same reasons....

 

[To20Chris]

In general I don't think CUTs depreciate as much as cars, as they are still useful tools long after a car is scrap. I couldn't find anything used locally (and in very good condition) to directly compare to the new CUTs I was looking at, so I don't have a direct comparison. I really don't think I would have saved $6K, or in other words I doubt there are many 1yr old, 100hr LK3054 w/ FEL and BH for $13K. I could be wrong (I often am!). I think you got a very good deal /forums/images/graemlins/smile.gif

 

[lablovers]

Interesting questions and I think a lot of folks started like me. First looked at greys, moved to used, checked out e-bay then finally bought new. In California, a good quality used is not a whole lot less than some of the new, especially with the dealer financing specials. It really depends on the budget, what you can get the CFO to buy off on and how you want to spend your time. Right now it is working with the tractor not working on it. To many jobs to do. Also, my last son will only be around a few years until he leaves for college. We really enjoy golfing and I want to have time for that too.

Also, as someone else pointed out, I want my tools available when I need them. Over the years, I have bought a lot of woodworking tools and done a lot of cabinet work, which has justified the cost. I plan on passing them down to my sons. Good quality tools last forever. Will I do the same with the tractor, maybe, it just depends on the boys.

Sorry to ramble, but I am trying to watch the Kings/Dallas game and it is hard to keep focused. Anyway, I hope you jist if what I am trying to say.

 

[puter]

</font><font color="blue" class="small">( ...I just could never justify it financially for those reasons...)</font>

That's really the crux of my point. I'm convinced that, with very few exceptions, those of us who try to financially justify the purchase of one of these tractors for residential use are just kidding ourselves... or we should have paid a lot more attention in our accounting classes. /forums/images/graemlins/wink.gif

Folks that purchase a tractor, do a bunch of jobs in a short period of time, and then sell the tractor might have a chance of coming out ahead.

But for those of us planning on keeping the tractor for a long time...no way. Figure the initial outlay of funds to purchase the tractor and implements, and what those funds could be earning over time. Then add in the time spent on the tractor and what could be earned by working those hours instead. And add in all the operating and maintenance costs. Compared to rental costs or hiring out, you'll usually be way behind.

When I was looking for a tractor I tried hard to make the numbers work. They didn't, and I bought one anyway. Like you, I'm sure that many of my projects will improve the property and offset the cost of the tractor some. But from a strictly financial perspective, I doubt I'll ever really be ahead.

That said, I don't regret the purchase at all. On the contrary, having the tractor available is enabling beyond my greatest expectations. So many things get done that wouldn't have otherwise. We do things now that we never would have considered before. Things that were hard/impractical/impossible before are now possible... sometimes easy. And using the tractor is a blast.

For the vast majority of us, when we buy a tractor, we're buying expensive seat time. Expensive but worth it in more ways than I could have imagined beforehand.

I think it may be helpful for folks considering purchasing a tractor to realize that they won't llikely be able to just financially justify their purchase. More than deciding what to do with their money, they're deciding what they want to do with their time. If they want to spend time sitting on a tractor, get one. If they just want to get some things done... there are probably less expensive ways available to them.

Financially, non-residential use would be a different game since "real" depreciation applies then. Heck, it might be worth setting up an equipment rental company to purchase the tractor and then rent it full-time from the company you own.

Thanks for the thought provoking discussion...

- Mark

 

[RalphVa]

Think it depends a lot on what tractor you're looking for. If you want one with FEL, small, ROPS, etc. you pretty much have to buy a new or nearly new one. A used one of these won't save you much money.

For those going out of trend, like the Gravely 2 wheeler, you can save a lot of money buying one used. I bought a 12 hp Gravely with 104 hours on it, 30" bush hog, riding sulky, cart, snow plow, snow blower and MacKissic shredder that mounts on it, all for $3,400 about 3 years ago. The main thing the Gravely needed was dual wheels and steering brakes for my hills. Repairs have mainly been a new fuse holder early on and a battery. The right wheel seal is leaky a tad, but it can wait. Got the skinny from Richard in WVa on how to do it easily.

Have since bought an old rotary plow for $200 that needed the guide wheels unfrozen to use. Have since derusted and repainted it.

Recently had the cart "Y" hitch reinforced to fix an ovaled hole and have the snow plow attachment in the welding shop for fixing ovaled holes on it.

Had to adjust the forward clutch a bit tighter to keep from slipping going uphill in high range.

Oh, there was a beautiful Ford 1700 2 cylinder diesel with bush hog at an estate sale over the weekend for $5,400.

Ralph

 

[To20Chris]

Ralph - can you give me more info on the MacKissic shredder? Will this fit an old Gravely Super Convertible? It's only a 6.6hp model. I need to do something as far as a chipper shredder goes, and I hadn't really thought about a Gravely mounted one. By the way, the rotary plow is an awsome tool - I just used mine again Here

I've found the tiller attachment to be kind of lame, but the rotary plow is very effective.

Thanks!

 

[rozett]

Brian, you make a very good point... financing! In my case I didn't need it, but many do. That one issue would make the new/used decision for most people. And there are some very nice financing deals out there on new machines.

As for shipping cost... I bought mine from a JD dealer in Alabama and had it shipped to Maine. They loaded it onto a freight truck and it only cost me $1000. Weighing in at 3200 pounds plus FEL and loaded tires, it had to be pushing 5000 pounds.

 

[slowrev]

Rozett,
I agree with you. I buy used and have no payments /forums/images/graemlins/smile.gif Consider this you can often buy 2 or 3 good older used tractors for what one new one sells for. Surely one of the three can be kept running.
I do hate flushing money down the drain on interest payments, I do not care about resale value as I buy tractors to keep and use up.
I bought an IH 2444 with industrial grade loader over a year ago. It is about the same weight and HP as a Kioti DK40. Everything works ok and I have put over 200 hours on it without any repairs except for the usual oil changes, etc. The price was 4,000 , about the price of a good riding lawnmower.

Lets see... new DK40 with heavy duty loader maybe 19K or so, after only a year and a half for a new DK40 I would have paid close to 4k in payments, so does that mean my used tractor has already paid for itself ? Not really but it is a nice way to think about it.

This is for handy self fixers only though. If you need a tractor and are not handy with tools buy new.

If you are a good/reasonable mechanic and do not have to have the new shine and status, used saves a LOT of money.

Oh and btw, The same models as my tractor are now selling for around 6K, so my tractor actually appreciated about 25% in less than 2 years instead of depreciating.