Kubota still offering 0 percent financing

[WVH1977]

I am just going to brutally honest about financing and myself in general. First off, I am guilty/dumb/stupid/got to have it now/good credit/don't save enough category. I have never followed my grandparents/great aunts/uncles way of doing business or advice. They did not finance everything they owned. They SAVED their money. They also had money and did not make anywhere near the same amount of money yearly that I do or make splurge/got to have it now purchases.

I really want a new bigger/better tractor some kind of bad. I have a good salary and could go to any dealer and finance what I want today and come home with a new machine. I have great credit. However, I would be stuck with a 600 dollar a month payment for 6/7/8 years. I am FINALLY learning to be patient and try and save my money instead of financing something I really cannot afford. That is the secret, "financing is for buying things we actually cannot AFFORD". I know some folks can afford and finance anyway to save form dipping into savings but then that money is not being invested or saved.

I am the sucker for 0 % financing. I am the sucker for 2.9% financing new vehicle. I have wasted thousands on loans buying vehicles/boats/etc. All because I had to have it now. The other problem with our current generation. We don't want to wait and save for 5 years then buy whatever outright. Gotta have it now. Then, 3 years in, your like man 600 dollars every stinking month and still have 4 years to go. Then something like your AC breaks and you need 4 grand to fix. That 600 a month saved would have paid for that. Go get another loan. Folks might not admit it on here but I am sure a lot of us have had those big monthly payments and after a couple of years wished it would go away. I know personally I am working now to try and get out of owning the bank/lender/credit union money all the time. We are beholden to the financial companies. I am the sucker for 0%. I also know I can go to the credit union and get whatever loan I need. I AM ADDICTED TO BORROWING MONEY that is not mine!!! It is there to bring you in the door and buy the shiny new thing you really probably don't have to have and should not finance anyway. This is my truth on the matter of financing.

 

[hiddentacocatneddih]

Financing has allowed prices to inflate to ridiculous levels. just look truck prices. They keep making longer terms to allow manufacturers to raise pricing.

 

[jyoutz]

I am just going to brutally honest about financing and myself in general. First off, I am guilty/dumb/stupid/got to have it now/good credit/don't save enough category. I have never followed my grandparents/great aunts/uncles way of doing business or advice. They did not finance everything they owned. They SAVED their money. They also had money and did not make anywhere near the same amount of money yearly that I do or make splurge/got to have it now purchases.

I really want a new bigger/better tractor some kind of bad. I have a good salary and could go to any dealer and finance what I want today and come home with a new machine. I have great credit. However, I would be stuck with a 600 dollar a month payment for 6/7/8 years. I am FINALLY learning to be patient and try and save my money instead of financing something I really cannot afford. That is the secret, "financing is for buying things we actually cannot AFFORD". I know some folks can afford and finance anyway to save form dipping into savings but then that money is not being invested or saved.

I am the sucker for 0 % financing. I am the sucker for 2.9% financing new vehicle. I have wasted thousands on loans buying vehicles/boats/etc. All because I had to have it now. The other problem with our current generation. We don't want to wait and save for 5 years then buy whatever outright. Gotta have it now. Then, 3 years in, your like man 600 dollars every stinking month and still have 4 years to go. Then something like your AC breaks and you need 4 grand to fix. That 600 a month saved would have paid for that. Go get another loan. Folks might not admit it on here but I am sure a lot of us have had those big monthly payments and after a couple of years wished it would go away. I know personally I am working now to try and get out of owning the bank/lender/credit union money all the time. We are beholden to the financial companies. I am the sucker for 0%. I also know I can go to the credit union and get whatever loan I need. I AM ADDICTED TO BORROWING MONEY that is not mine!!! It is there to bring you in the door and buy the shiny new thing you really probably don't have to have and should not finance anyway. This is my truth on the matter of financing.

There is a lot of wisdom in your advice, but there are lots of differing circumstances. There is nothing wrong with low interest loans as long as the monthly cash flow provides adequate funds to cover the financing, savings, and other expenses. Pulling funds from higher earning investments to pay cash really isn’t a great strategy if lower interest is available.

 

[Torvy]

I know some folks can afford and finance anyway to save form dipping into savings but then that money is not being invested or saved.

The error here is that large enough amounts of cash to pay for new tractors or cars should be invested. Taking out a low/no interest loan allows those investments to keep earning money.

The problem is not the loans, it is with the poor use of assets and what you said about not being patient. I guess I learned those lessons in my late teens/early 20s. Made some dumb mistakes because I was impatient.

Another dumb mistake people make is buying the label/status. Wearing an Izod instead of the store brand polo. See the same thing here. People want a tractor that other people will instantly recognize and assume they got the best. Maybe yes, maybe no, but those dollars could be put to use elsewhere and grow.

 

[rScotty]

I am just going to brutally honest about financing and myself in general. First off, I am guilty/dumb/stupid/got to have it now/good credit/don't save enough category. I have never followed my grandparents/great aunts/uncles way of doing business or advice. They did not finance everything they owned. They SAVED their money. They also had money and did not make anywhere near the same amount of money yearly that I do or make splurge/got to have it now purchases.

SNIP

That's right, but circumstances were different.

I'm from that generation - maybe a little bit older than your grands and greats. I'm getting onto yur great grandparents age now....and let me tell you that getting old is weird.

For one thing there were a lot less people in your grandparent's generation. Food, clothing and housing was a lot less expensive - I'm figuring that by how much of a paycheck each staple item consumed. So the grandparents were able to save and pay off a starter house in 5 or 10 years, a car in 2 or 3. That's a huge advantage.

And they fixed or patched stuff. Pre-TV and internet gave people a lot more spare time. Reading is cheap, but so is doing maintenance and repairs on the house you own as a sort of half entertainment and half way of life. "Ka-ching" goes the cash box as another (silver) half dollar is saved..... and as tiresome to hear about it as it is, they really did do a lot of things they boast on now. Things that many people pay to have done now.

Flying for vacation? Walking to work? AIR CONDITIONING!! AC hadn't been invented yet for my generation. Teenagers worked the fields and and played sports in south Texas in the hot summertime. It wasn't a hardship; it was fun. Summer was sweaty, but we couldn't miss what hadn't been invented - except that we missed out on having to pay for it.

Don't beat yourself up too much. Us grandparents weren't saints. The world really was different. Simpler and more friencly. Your generation has a lot more choices as well as a whole lot more challenges & expenses.

To me it looks like credit is a free ride to funville. Yes, I saved and did well - but if I was your generation I would be maxing out the credit cards in all directions. Why not?
Go for it! Have fun! Enjoy!
and be kind.

rScotty

 

[WVH1977]

I'm from that generation - maybe a little bit older than your grands and greats. I'm getting onto yur great grandparents age now....and let me tell you that getting old is weird.

If you are in your in your hundreds you are definitely an old man. LOL. All my grands are passed on. I really miss that older generation. They knew things and took care of business. I am really fortunate to have been around them for as long as I was. Learned a lot from them. Just took me a few decades for it to sink in.

 

[PreacherM]

I am just going to brutally honest about financing and myself in general. First off, I am guilty/dumb/stupid/got to have it now/good credit/don't save enough category. I have never followed my grandparents/great aunts/uncles way of doing business or advice. They did not finance everything they owned. They SAVED their money. They also had money and did not make anywhere near the same amount of money yearly that I do or make splurge/got to have it now purchases.

I really want a new bigger/better tractor some kind of bad. I have a good salary and could go to any dealer and finance what I want today and come home with a new machine. I have great credit. However, I would be stuck with a 600 dollar a month payment for 6/7/8 years. I am FINALLY learning to be patient and try and save my money instead of financing something I really cannot afford. That is the secret, "financing is for buying things we actually cannot AFFORD". I know some folks can afford and finance anyway to save form dipping into savings but then that money is not being invested or saved.

I am the sucker for 0 % financing. I am the sucker for 2.9% financing new vehicle. I have wasted thousands on loans buying vehicles/boats/etc. All because I had to have it now. The other problem with our current generation. We don't want to wait and save for 5 years then buy whatever outright. Gotta have it now. Then, 3 years in, your like man 600 dollars every stinking month and still have 4 years to go. Then something like your AC breaks and you need 4 grand to fix. That 600 a month saved would have paid for that. Go get another loan. Folks might not admit it on here but I am sure a lot of us have had those big monthly payments and after a couple of years wished it would go away. I know personally I am working now to try and get out of owning the bank/lender/credit union money all the time. We are beholden to the financial companies. I am the sucker for 0%. I also know I can go to the credit union and get whatever loan I need. I AM ADDICTED TO BORROWING MONEY that is not mine!!! It is there to bring you in the door and buy the shiny new thing you really probably don't have to have and should not finance anyway. This is my truth on the matter of financing.

You are choosing a wise path. Keep it up!

Financing has allowed prices to inflate to ridiculous levels. just look truck prices. They keep making longer terms to allow manufacturers to raise pricing.

Exactly. Far too many people only look at the montly payment cost. Getting the heated and cooled leather is only a couple dozen bucks a month, so it's considered a cheap luxury. They forget to multiply by 72, 84 or whatever the number of payments.

There is nothing wrong with low interest loans as long as the monthly cash flow provides adequate funds to cover the financing, savings, and other expenses.

So what happens when the economy takes a dip or you suddenly lose that large salary?

 

[jyoutz]

You are choosing a wise path. Keep it up!

Exactly. Far too many people only look at the montly payment cost. Getting the heated and cooled leather is only a couple dozen bucks a month, so it's considered a cheap luxury. They forget to multiply by 72, 84 or whatever the number of payments.

So what happens when the economy takes a dip or you suddenly lose that large salary?

I still have my cash investments that have grown. And diversified so some is invested risk free.

 

[PreacherM]

I still have my cash investments that have grown. And diversified so some is invested risk free.

Then you are working the system to your advantage. I'll wager that not many Americans under the age of 40 are managing their money that way.

 

[jyoutz]

Then you are working the system to your advantage. I'll wager that not many Americans under the age of 40 are managing their money that way.

I would never pay cash if I could finance at a lower rate than I can make investing the cash

 

[Hay Dude]

Problem is, there‘s few investments out there making money. Interest rates for financing equipment are high now, but bank interest rates are extremely slow to catch up

The market seems to be bumbling along, but worries of the market crashing again by 30% have a lot of investors leary. Precious metals are flat.
I bonds are nice, but long term investments.

There’s really not a lot of places to go and record 45 year high inflation has now settled in and isnt’ going anywhere chewing away the lower & middle class’s money.

I am pretty inclined to say no to financing anything for personal use other than a home mortgage or home line of credit.
As far as financing business equipment goes, its a cost of doing business. It would be hard for 90% of businesses out there to even be IN business without financing. I have used it, paid off my loan and at the end own a nice, well cared for asset that can continue to be used, or trade for something else. I financed a farm tractor 4 years. Bought for $41,000 and sold it last month for $56,000. So I used it for 3 years & 1,000 hours and got paid $15,000 for doing so. Not bad if you ask me.

The key is, not to finance something for 5 years that will be worth ZERO when it’s paid off. IMO, must be worth the interest paid and then some to have been worth financing.

 

[Torvy]

The problem for most people is they look at a day, a month or even a year and get scared away from investing. If a loan is for 60-84 months, I would invest the cash now. Low prices are a good thing when you are buying investments. By the time the loan is complete, that investment will have earned much more than i paid for loan interest.

Of course, if someone is too old for longer term investments, that is a whole other kettle of fish.

 

[Lineman North Florida]

It's different for everyone, I recently bought a new skidsteer and decided against the 0% interest for 48 months in lieu of an additional $2700.00 dollars off of the machine if I paid cash, I am already invested to the hilt and with the current state of affairs felt more comfortable to go ahead and pay it off up front. I have a 457 retirement plan, a Roth IRA and completed 5 years in a drop program which I rolled into cash bonds right before the stock market started to tumble thankfully, but I am watching the market closely as I do want to buy back in before it makes it's bounce back upward.

 

[arrow]

M

All dealers do NOT pay the same wholesale. Most manufacturers offer their best dealers all sorts of incentives. Sometimes they also offer incentives to new dealers to help them get started moving product. On top of that, some dealers go for higher volumes with lower margins; others want higher margins and sell fewer units.

I don't know what dealers you're talking about but all matching option Mahindra's ( brand I work at) cost the same per dealer.
Whatever "incentives" you're talking about are gone nowadays. Incentives were like trips to Japan or India or year end bonus's. If there were "specials" or tractors slow to sell because they were gear models, all dealers ordering these would get the "special" pricing. But when you're putting in an order, the price is the price for all dealers selling the brand.

Ariens/Gravely (which we carry) works on a tier system. ( silver, gold, platinum) Depending on what tier you're on, (tiers established on orders submitted) depends on what you're paying as a dealer. We ordered 35 zero turns and 35 snowblowers and are considered a "silver" company.

So what tractor companies (since that was what the thread was about) were you referring to that offer differentiated wholesale pricing depending on sales model?

 

[rScotty]

That's confusing. Maybe it needs more explanation. It sounds to me that firstyou are saying that all dealers pay the same, and then explaining that Ariens/Gravely has a tiered dealer system where the dealer price depends on what tier the dealer is on. I appreciate your forthrightness and effort to educate the TBN group, but what you are describing makes it sound like you don't completely understand your own system. That may be my own perception, so explain if you want.

But that's beside the point. The original point was that there are a lot of different companies and their pricing policies are their own business. Your deal with the company you represent is just that - your deal. It doesn't have any influence on the rest of the tractor industry - or any industry. They all make their own rules. Everyone in business does that.

rScotty

 

[arrow]

More explanation forthwith: I'm talking about tractors. Ariens/Gravely is a product we carry. Mostly grass cutters and snow blowers.
I asked what tractor companies have deviated pricing since the original thread was about Kubotas.
A statement was made by Torvy that dealers "do not pay the same wholesale". Mahindra dealers do for tractors. I am curious to know what or if any other tractor company does not have this caveat.
Of course I know my own company and is "my own deal" as a result. I am asking what may be someone else's "deal" as it applies to tractor sales who works for another company and knows the in's and outs of said dealership as it relates to company product purchases of tractors.
I am curious to know if anyone here knows what they're talking about as it applies to their own experience as a result of them or a relative working at a tractor dealership with tiered pricing on just tractor purchases.

 

[rScotty]

More explanation forthwith: I'm talking about tractors. Ariens/Gravely is a product we carry. Mostly grass cutters and snow blowers.
I asked what tractor companies have deviated pricing since the original thread was about Kubotas.
A statement was made by Torvy that dealers "do not pay the same wholesale". Mahindra dealers do for tractors. I am curious to know what or if any other tractor company does not have this caveat.
Of course I know my own company and is "my own deal" as a result. I am asking what may be someone else's "deal" as it applies to tractor sales who works for another company and knows the in's and outs of said dealership as it relates to company product purchases of tractors.
I am curious to know if anyone here knows what they're talking about as it applies to their own experience as a result of them or a relative working at a tractor dealership with tiered pricing on just tractor purchases.

Well, that's reasonable. And it lets me out. My experience both as a dealer and working with the importer/distributor/dealers network was in motorcycles.... not tractors. I also have some experience with the same level of buying for metals for fabrication and for machine tools - but none of that is in tractors, so it won't help with your question.

My only experience with tractor wholesale prices was years ago at local business meetings where one tractor dealer constantly complained that Kubota sold at lower new prices to rental yards than they did for their tractor dealers. Like I said, that was years ago. I wonder if they really did or still do?? I can't see why not. In my mind that is just business as usual - actually a pretty clever business move, IMHO.

rScotty

 

[arrow]

Well, that's reasonable. And it lets me out. My experience both as a dealer and working with the importer/distributor/dealers network was in motorcycles.... not tractors. I also have some experience with the same level of buying for metals for fabrication and for machine tools - but none of that is in tractors, so it won't help with your question.

My only experience with tractor wholesale prices was years ago at local business meetings where one tractor dealer constantly complained that Kubota sold at lower new prices to rental yards than they did for their tractor dealers. Like I said, that was years ago. I wonder if they really did or still do?? I can't see why not. In my mind that is just business as usual - actually a pretty clever business move, IMHO.

rScotty

I worked at a car dealership for almost 20 years in truck sales.
Everyone paid the same for what was then called Dodge Ram trucks.
With Quotas met, the dealer got added bonus money but when you sat down and ordered specific options, those prices were the same for every Dodge dealership within the region.
Kick backs with floor plan money was just about gone if a product was on the lot for longer than 6 months.

 

[rScotty]

I worked at a car dealership for almost 20 years in truck sales.
Everyone paid the same for what was then called Dodge Ram trucks.
With Quotas met, the dealer got added bonus money but when you sat down and ordered specific options, those prices were the same for every Dodge dealership within the region.
Kick backs with floor plan money was just about gone if a product was on the lot for longer than 6 months.

I wouldn't doubt that the wholesale & option prices were the same for every dealership within your area. In fact if I was a dealer I'd insist on that.
But that is still a restricted area and probably all under one local distributor. There is likely to be a NE Coast distributor who wholesales Dodge Rams to several hundred dealerships & they all charge the same for everything.. I hope.....

Depending on the type of business there may be a number of distributorships in the country.

For the importer I worked for there were only had two distributors - East and West, roughly divided at mid-continent where each had about 25 dealers. Each distributor had their own policies and prices for his own dealers. BTW, the prices were very close to the same. Volume made the difference.
But we were small time. The tractor industry is many times larger. That's why I am really not much help with your question. I understand how the dealership system can work in one small instance and in broad strokes, but not in the details you are asking about.

Cars & trucks have even more distributors as well as another layer above them - the importers and exporters who also buy from the factory and sell to distributors.

It's just one more reason why different dealers may be able to offer different prices - or types of financing.

rScotty

 

[Torvy]

It will be impossible to prove it to you directly as I would need to get the agreements from various manufacturers and different dealers. I know from word of mouth with various dealers and various manufacturers that this is a very common practice among equipment manufacturers.

To whit this is an excerpt from a North Dakota law pertaining to how manufacturers can interact with dealers.

"This subdivision does not diminish the manufacturer's, wholesaler's, or distributor's ability to provide volume discounts, bonuses, or special machine ordering programs commonly used in the industry."

The law specifically calls out the fact that such practices are common in the industry and not prohibited.

North Dakota Century Code Title 51. Sales and Exchanges § 51-07-01.2 | FindLaw

North Dakota Title 51. Sales and Exchanges 51-07-01.2. Read the code on FindLaw

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