Are CUT Manufacturers pricing themselves out of the market?

[etpm]

the 1980's yanmars might still be running.

Mine still runs very well. A 1980 or '81 YM2310.
Eric

 

[Cahaba Valley Farm]

I have been following the CUT market for 5 years and the conclusion I reached is prices will not come down as long as the industry can continue to convince the consumer to accept it's free financing in exchange for overpaying for the equipment.

 

[arrow]

Our

Absolutely. One good answer that works for everyone is to buy low hour used equipment. Tractors that have been used enough to be proven, but not enough to be worn.

I am old enough to remember another time - the 1950/60s - when new prices got totally out of reach.
What happened back then was independent & inexpensive repair shops sprang up everywhere almost overnight. Maybe that will happen again.

Our present work force prefers to use their thumbs.
Don’t think enough kids are coming out of vocational schools nowadays for this to happen.
I keep thinking of the song “ln the Year 2525”. There is a line saying we’ll have no use for our arms and legs.
I think l see us moving toward that now.

 

[Hay Dude]

I can remember when our small community had a Ford and an International Harvester dealer. They went away 30-40 years ago.

We had an International Harvester dealer, too.
Only dealer in my little town. The owner was a good man. When he became elderly, he promoted his son in law to run the operation in the mid 70's.
He was a gold digger and a piker. He took cash payments, pocketed them, and never took the units sold for cash off the books.
IH Corporate got wind of this and one day at sunrise, about 20 lowboy trucks showed up. They took all remaining inventory and removed the franchise from him.
Sad ending, but IH didn't have many years to live anyway.

Here's what's left of the business. Still painted IH red!

 

[ultrarunner]

I can remember seeing people pitch fork hay onto a wagon pulled by mules. An old 2N was a luxury item.

My earlier memories pitching hay onto the wagon.

 

[Hay Dude]

"You will own nothing" is the way we are going.
I feel like the last 10 years everything has doubled in price (or more) but wages up maybe only 10-30% in most occupations?

I mean go back 60 years ago, my dad was a mason and supported the whole family on his salary alone and we lived in a decent single family home and had a car and a truck.

Today? Both spouses need to work to have the same unless you have a very high single income spouse.

Wheres all this going? Who can/wants to pay 35k for an oversized 4WD garden tractor with a tiny loader?

 

[jyoutz]

I say yes. I baulked and bought low hours used for 40% less than new.
Manufacturers have definitely crossed a line where a lot of people refuse to go no matter the product.

I looked at the used market for months before buying new. I couldn’t find anything for less than about 85-90% of new, unless it was old with a lot of hours.

 

[ultrarunner]

Growing up most moms were stay at home…

The mom across the street held a union job and her husband was plant super intendant.

Us kids would ask why the neighbors were taking annual big vacations and new cars every other year and dad said it’s because they both work.

As both spouses started working the disposal income increased and they had quite an advantage in most cases.

Now it is somewhat rare to see stay at home spouse… at least here.

That extra money gets spent and almost forces all into the work force just to keep up.

 

[jyoutz]

How's the price of eggs in your area?

Haven’t bought any in years. The chickens keep us in more than we can use.

 

[jyoutz]

To my way of thinking, it's insane for a first time non-business tractor buyer to even consider buying new. They shouldn't be taking a loan out for any machine unless it's going to pay for itself.

It’s all about cash flow. If someone has few other debts and an income that supports the loan, what’s the problem? People have work to do to maintain their land and saving for years doesn’t make sense. As I posted, it’s sometimes difficult or impossible to find deals on used equipment, and then often not the size/capability machine that is needed.

 

[jyoutz]

Those old Fords and Internationals were used by farmers who actually made a living with them. I can think of one farm where the Dad and the son are both deceased, and the grandkids sold the farm that meant everything to the Dad and son.

Family farms are getting fewer and fewer. When there are several sons and daughters who split inheritances, often the only option is to sell and divide the money. This is happening everywhere.

 

[jyoutz]

Amish don't need a tractor to do hay, why can't he.
Guess he doesn't want to do manual labor

Amish with 10 kids to do the work.

 

[Hay Dude]

I think we can agree that probably 80+ % of the regular posters here are 50+, own property, and their hobby is land/home improvements. Most of us own a tractor, so we tend to get a little myopic in thinking we are like the average US citizen who couldn't come even close to buying a small CUT tractor.

The average TBN guy might be able to finance a tractor, but I'd bet the number who can pen a check for a tractor has dropped a lot in the last 20 years.

I paid cash for a Kubota L-35 and quickly outgrew it and bought a full sized backhoe.
No way I could do that now. Most All my farm equipment is higher hours and well used.

 

[Portuguese Farmer]

Inflation only happens if people keep buying, example, I see eggs in the states for ridiculous prices and everyone piles them on the cart, why? Btw a dozen brown eggs here are 2.09€

 

[2manyrocks]

Family farms are getting fewer and fewer. When there are several sons and daughters who split inheritances, often the only option is to sell and divide the money. This is happening everywhere.

One option used to be to create an irrevocable trust funded with a life ins. Policy on the farmer to cash out the non farmers. Don’t know if that is still a viable option, but the idea was to have the farm pass to those active on the farm and have cash pass to the others.

Another option is for the parent to specify which part of the farm goes to who without buying life ins.

Rarely good idea to leave farm to all equally hoping they will agree among themselves. Only takes one stubborn heir to mess it up.

 

[Hay Dude]

Inflation only happens if people keep buying, example, I see eggs in the states for ridiculous prices and everyone piles them on the cart, why? Btw a dozen brown eggs here are 2.09€

It also happens if we get a bird flu that kills 100 million chickens in the US

 

[Hay Dude]

One option used to be to create an irrevocable trust funded with a life ins. Policy on the farmer to cash out the non farmers. Don’t know if that is still a viable option, but the idea was to have the farm pass to those active on the farm and have cash pass to the others.

Another option is for the parent to specify which part of the farm goes to who without buying life ins.

Rarely good idea to leave farm to all equally hoping they will agree among themselves. Only takes one stubborn heir to mess it up.

We have an amazing legacy farm in my neighborhood where the father just passed. He was a former state senator.
He had several children, all with varying degrees of interest in farming.
Knowing he was dying and did NOT want the farm to go to the developer, he put all the land in a local land conservancy to make development nearly impossible by his children after he was gone. He left the farm to all his adult children (all about 50-70 years old) and they all fight constantly about who does more work, etc.
It ain't pretty, but the farm was saved from development

 

[2manyrocks]

That is another option. But disagreements will happen over who is or isn’t doing their fair share of the work and someone will want to sell when others don’t. So leaving an entire farm to multiple heirs as tenants in common is going to result in conflict. People who think treating them all equally should think harder before doing that.

 

[Portuguese Farmer]

It also happens if we get a bird flu that kills 100 million chickens in the US

When I lived there I never believed any of that bs, still don't and the truth is being seen, factually. If true, why do people load up and ridiculous prices?

 

[5030]

Never seen any estate where the heirs didn't fight over something and it's usually the proceeds they never earned in the first place. Human nature to greedy when it comes to unearned proceeds.

Better to pass penniless than leave anything for heir's to fight over.

Myself, I plan on blowing every cent I can on myself and my wife and leave this world like I came into it...