New Tractor Sales Are Declining

[scootr]

Funny….I’m seeing just the opposite on larger tractors. VERY little used inventory. I think Covid years (20-21) resulted in a LOT of buying.
Shelves are pretty bare in my buying category.

I think it’s because interest rates are at a 15 year high and people with existing tractors are holding onto them. They aren’t trading in on newer or new ones until rates come down to reasonable levels again.

Could be new prices are so high for under 50hp tractors that buyers are put off. Couple that with high interest and you got reason enough for some degree of a new sales slow down. Heck the hobby farm costs too much too. I think buyers feel pricing will go down sooner or later. So why not put off that big purchase and see. I think alot people staying put - holding their cards right now.
Things I'm buying now are things I can pay cash for.

 

[Hay Dude]

Could be new prices are so high for under 50hp tractors that buyers are put off. Couple that with high interest and you got reason enough for some degree of a new sales slow down. Heck the hobby farm costs too much too. I think buyers feel pricing will go down sooner or later. So why not put off that big purchase and see. I think alot people staying put - holding their cards right now.

The hobby farm costs too much because all the citiots came out and bought them. That raised demand and prices. Tractor dealers know this and raised prices praying on people’s fears of leaving cities and having their own little farm.

 

[scootr]

The hobby farm costs too much because all the citiots came out and bought them. That raised demand and prices. Tractor dealers know this and raised prices praying on people’s fears of leaving cities and having their own little farm.

Wonder how long it will be before all those dreamers flood the market with their failed farming adventures... I remember reading something about people (NYers) flocking to TN AR KY in 2020 and selling 1 yr later when reality hit.

 

[Cahaba Valley Farm]

Funny….I’m seeing just the opposite on larger tractors. VERY little used inventory. I think Covid years (20-21) resulted in a LOT of buying.
Shelves are pretty bare in my buying category.

I think it’s because interest rates are at a 15 year high and people with existing tractors are holding onto them. They aren’t trading in on newer or new ones until rates come down to reasonable levels again.

With where interest rates are now I can't imagine anyone looking at used anything.

 

[scootr]

Private cash sales is where the market is at right now.

 

[Cahaba Valley Farm]

Private cash sales is where the market is at right now.

I haven't seen a drop in prices to support that idea yet. Last time I checked used was almost as much as new.

 

[scootr]

I haven't seen in drop in prices to support that idea yet. Last time I checked used was almost as much as new.

There are fewer buyers of everything due to the economic climate. Purse strings are tightening up which will bring the prices down, that economics 101. It will happen slower or faster in certain industries and regions. But it is coming

 

[5030]

I doubt dept free farming even exists. Very few people living dept free too. In fact records show the average American is carrying more dept today than anytime in the last 10 yrs

Not me, basically all paid for.

 

[Yander]

I suspect that John Deere and Kubota will let the Mothership cruise along, but I wonder what the up and comers (Kioti, LS, Mahindra, etc.) do. They liked gaining market share during the pandemic, and are going to want to continue to build their brand. Additionally, they are not going to want to see their dealerships close, and have to rebuild a dealer network. Finally, they are going to want to keep their factories busy.

I don't know what strategies they might want to pursue, but I'll bet there are lots of discussions about how to make lemonade out of all this

I could see the Kioti, LS, Mahindra doing better in an economic downturn because of their price point.

Whatever some may feel about John Deere or Kubota, just as many others feel they are overpriced. If I had to have a tractor and I was already struggling financially I wouldn't be buying a Kubota or a John Deere.

 

[Yander]

I know this threat is focused mostly on tractors and their prices but something that, affects that that is happening it's the food prices.

Obviously food is not a discretionary item and yet I don't think we're at the worst of our food inflation issue.

I'm sure your wives or whomever does the grocery shopping in your house can tell you every time they walk in and walk out they have less groceries and more money out of their pocket.

It is a fact that will affect discretionary spending of all types tractors, cars etc.

 

[Hay Dude]

With where interest rates are now I can't imagine anyone looking at used anything.

You’d be surprised. Sometimes you have to. New unaffordable and equipment wears out or becomes too small for growing companies. I’m in that situation sometimes

 

[Hay Dude]

There are fewer buyers of everything due to the economic climate. Purse strings are tightening up which will bring the prices down, that economics 101. It will happen slower or faster in certain industries and regions. But it is coming

And of course that means lower demand, less borrowing, then eventually lower inflation, then hopefully an easing of interest rates.

Covid is a huge pusher of inflation. It caused a massive buying & borrowing spree in 20-21.

 

[lman]

And of course that means lower demand, less borrowing, then eventually lower inflation, then hopefully an easing of interest rates.

Covid is a huge pusher of inflation. It caused a massive buying & borrowing spree in 20-21.

I wouldn't say Covid pushed inflation. It was the policies of free money by the govt. that put us where we're at. Inflation will continue until we get a handle on the amount of spending by the govt. and it doesn't look promising.

 

[Hay Dude]

I wouldn't say Covid pushed inflation. It was the policies of free money by the govt. that put us where we're at. Inflation will continue until we get a handle on the amount of spending by the govt. and it doesn't look promising.

Certainly helped. But I also couldnt help notice the spending spree that happened. Even our esteemed government officials blamed inflation and interest rates on us.

 

[CloverKnollFarms]

Already seeing <24 month old tractors go up for sale around here because of folks businesses slowing due to the economy. One fella said he will entertain any offer, and he is already $5k under the value of the tractor. (17%)

Rates are up again. The holiday sales numbers are way down. The economy is slowing to the point that employment will be impacted in 2023, and a real recession will begin. All of this foretold over a year ago.

I‘m looking at a couple very lightly used units this week, cash purchase only.

In time, all rational predictions come true… that time is coming.

 

[Cahaba Valley Farm]

I wouldn't say Covid pushed inflation. It was the policies of free money by the govt. that put us where we're at. Inflation will continue until we get a handle on the amount of spending by the govt. and it doesn't look promising.

It was both. Then add the senile, so called president and his energy policies into it and you have inflation that is not going away anytime soon.

 

[2manyrocks]

I can't imagine an experienced economist like Paul Volker increasing the money supply so much and so fast.

Often, the Fed is responding to what happens in the economy, but in this instance, in my personal opinion, the Fed has significant responsibility for price inflation jumping up and has responsibility for the economic melt down that will result from their efforts to get inflation back under control. Steadier, more experienced economists of the past wouldn't have gone to the same extremes as the people at todays Fed, IMPO. All this mess could have been avoided.

 

[CloverKnollFarms]

But when you buy votes, things get costly

 

[sd455dan]

Already seeing <24 month old tractors go up for sale around here because of folks businesses slowing due to the economy. One fella said he will entertain any offer, and he is already $5k under the value of the tractor. (17%)

Rates are up again. The holiday sales numbers are way down. The economy is slowing to the point that employment will be impacted in 2023, and a real recession will begin. All of this foretold over a year ago.

I‘m looking at a couple very lightly used units this week, cash purchase only.

In time, all rational predictions come true… that time is coming.

YEP, Wait until all of the people that bought a Home with an ARM are up against a wall, and also decided they could afford a new CUT payment jn addition when the Gov handed out that free money.

It is going to get Real... Real Quick for a Lot of home / small farm buyers that signed ARM's

That will also apply to those folks carrying a lot of credit card debt and making even one late payment.

 

[hornett22]

I can't imagine an experienced economist like Paul Volker increasing the money supply so much and so fast.

Often, the Fed is responding to what happens in the economy, but in this instance, in my personal opinion, the Fed has significant responsibility for price inflation jumping up and has responsibility for the economic melt down that will result from their efforts to get inflation back under control. Steadier, more experienced economists of the past wouldn't have gone to the same extremes as the people at todays Fed, IMPO. All this mess could have been avoided.

Whatever politicians are telling you they're going to fix, they caused.