FarmTrac Troubles
- Thread starter gamble77
- Start date
- Views: 580280
redneckford
Platinum Member
Oh Really!!!! Then I quess all these dealers in Southwest Louisiana and East Texas are just lying to their customers---cause that seems to be the word from the local dealers??????----Like everything else show me the proof----and while you are getting the proof how about those files showing inventory loading,invoice inflation,voodoo interest charges and I think they called it Favorer-ed Dealer Status!!!!!----I'm sorry I already got all that and it is notarized and in the mail to an Ole blue d-------!!!!!!!!! AND just maybe they told everyone but YOU!!!!!
country69
Member
Tim C is right. Look for something next week.
redneckford
Platinum Member
About what "time is on the dealers side" or------???????? Here comes the JUDGE?????!!!!!!!!
redneckford
Platinum Member
ole blue----you got to get us an invite to this 2% club!!!!!! Taxpayer since your not a @% member yet???----- you want a invite too?????? they sure teach you how to "TALK" nice!!!!
Eric_Phillips
Platinum Member
I was wondering if some one could post all the affiliates of Textron so that we can avoid them. I can assure you I am not in the market for a Bell helicopter but from an earlier post it looks like they also own Greenlee. I did buy a Greenlee multimeter earlier this year. I would have made a different decision had I known.
Just out of curiosity I have been trying to figure out how this whole buisiness was structured. So LS and Escort made the tractors. Now do they have a similar parent company or are they separate? Then there is Farmtrac, Montana, etc. Were/are these independant companies that then buy the tractor parts from LS and Escort then assemble and sell them in the US? Then what was Textron supposed to do? Not being in the buisiness I am not sure what a floor plan company does.
Just out of curiosity I have been trying to figure out how this whole buisiness was structured. So LS and Escort made the tractors. Now do they have a similar parent company or are they separate? Then there is Farmtrac, Montana, etc. Were/are these independant companies that then buy the tractor parts from LS and Escort then assemble and sell them in the US? Then what was Textron supposed to do? Not being in the buisiness I am not sure what a floor plan company does.
bluechip
Veteran Member
Short answer: LS and ESCORTS supplied tractors to Farmtrac NA. Escorts held a controlling interest in Farmtrac NA. LS had no ownership. LS and Escorts are not related otherwise. LS is Korean and Escorts is Indian. Textron Financed inventory for Farmtrac NA, and also served as the "private branded" floor plan company. That is they financed the dealer's inventory as well. Manufacturers use dealer floorplanning to encourage dealers to stock more inventory. It doesnt take much thought to see that a dealer financing an expensive inventory, like tractors, and selling at the low margins that tractors bring would make little economic sense. Manufacturers and distributors bridge the gap by paying the interst costs for some period of time. The game is that the dealer must sell before that time is over or he could end up losing all of his profit on the unit in interest. Famrtrac offered indefinate free flooring to thier dealers, but the transactions were not documented that way with Textron. Most dealers are holding inventory that they accepted with the understanding it would not bear interest or "come due" which is when a floorplanned tractor has to be paid for regardless of being sold or not. LS filed a suit against Farmtrac NA in NOvember which apparently caused Escorts to withdraw and the company went into receivership on behalf of the creditors. So now we have a big mess.
redneckford
Platinum Member
Great answer Blue Chip---but I bet you loose your membership in the 2% Club----Tim C how about a followup on Blucher's recollection of the facts----Someone seems to leave the territory men out of this discussion!!!!
Eric_Phillips
Platinum Member
Bluechip,
Thanks for the answer. That helps us not in the business understand how the players fit together.
Thanks for the answer. That helps us not in the business understand how the players fit together.
Red, Chip did a good job. Add that to you take on the "value" of the inventory and you have quite story.
I know it does not sound bad to say each tractor is only over floor planned by 2K. Per dealer that is 20K on 10 tractors. Per company it is 5 Million for the total floor plan on 2500 tractors.
That is interest bearing 365 days a year.
This is "fake" money. It never was there and never will be. But the company has an extra 5 mil to play with, the debt is transferred to dealers, and the floor plan company clears an extra 300K (min.) in interest each year.
Change the above number to 4K per tractor. We are talking real money now. Wait, we were talking real money anyway.
And Farmtrac did it without buying a lottery ticket.
The real problem is they are not unique in the industry. It is like "meth". The whole industry is hooked.
If you get a chance, look into Redball sprayers and Feterl augers. Both are going down. One has an amazing likeness to a certain other company.
Tim
I know it does not sound bad to say each tractor is only over floor planned by 2K. Per dealer that is 20K on 10 tractors. Per company it is 5 Million for the total floor plan on 2500 tractors.
That is interest bearing 365 days a year.
This is "fake" money. It never was there and never will be. But the company has an extra 5 mil to play with, the debt is transferred to dealers, and the floor plan company clears an extra 300K (min.) in interest each year.
Change the above number to 4K per tractor. We are talking real money now. Wait, we were talking real money anyway.
And Farmtrac did it without buying a lottery ticket.
The real problem is they are not unique in the industry. It is like "meth". The whole industry is hooked.
If you get a chance, look into Redball sprayers and Feterl augers. Both are going down. One has an amazing likeness to a certain other company.
Tim
Hey Textron, got written word today the Department of Agriculture, Trade and Consumer Protection Agency is also on the case. That information along with a lot of new names that are posting here makes me think that more people are learning about the real Textron. That can't be good for your bottom line?
I love the post that wants the complete list of all Textron affiliates so as not to do business with them. I don't care what color tractor you own, the people on this site know right from wrong. Thanks to all for the support, now lets get that list together!
Case
PS I love to state that my Farmtracs are great!!!!!!!!!!
I love the post that wants the complete list of all Textron affiliates so as not to do business with them. I don't care what color tractor you own, the people on this site know right from wrong. Thanks to all for the support, now lets get that list together!
Case
PS I love to state that my Farmtracs are great!!!!!!!!!!
redneckford
Platinum Member
Red, Chip did a good job. Add that to you take on the "value" of the inventory and you have quite story.
I know it does not sound bad to say each tractor is only over floor planned by 2K. Per dealer that is 20K on 10 tractors. Per company it is 5 Million for the total floor plan on 2500 tractors.
That is interest bearing 365 days a year.
This is "fake" money. It never was there and never will be. But the company has an extra 5 mil to play with, the debt is transferred to dealers, and the floor plan company clears an extra 300K (min.) in interest each year.
Change the above number to 4K per tractor. We are talking real money now. Wait, we were talking real money anyway.
And Farmtrac did it without buying a lottery ticket.
The real problem is they are not unique in the industry. It is like "meth". The whole industry is hooked.
If you get a chance, look into Redball sprayers and Feterl augers. Both are going down. One has an amazing likeness to a certain other company.
Tim
There went your membership in the 2% club!!!!!
SESS
Gold Member
We know that Farmtrac and Montana are floor planned with Text***-WHO ELSE IS???? Come on, don't be shy-we want to hear all the other brands that are floorplanned with them as well!
redneckford
Platinum Member
I bet Messick knows?????!!!!!
bluechip
Veteran Member
Tim makes a great point, Almost every company sells tractors, and manages thier field inventory, by way of offering "DSA" dealer settlement allowance incentives. This money and/or any funds needed to "Buy down" interest rates for all those Zero percent deals you see, are included in the invoice price to dealers, then credited back after the unit sells. If the manufacturer fails, as in the case with Farmtrac, the dealer is stuck owing a balance that includes the funds that were supposed to come back to the dealer, typically passed on to the buyer in order to make the transaction more attractive, either with low rate financing, price discounts, over allowance on a trade or all of the above.
redneckford
Platinum Member
Thank --- For the Friday Follies!!! Read and weep!!!! Ole Blue and Co great job the rest on the way!!!!!
http://www.swassn.com/News/SWAFlash-Sept08.pdf
http://www.swassn.com/News/SWAFlash-Sept08.pdf
Chip, when the buying public figures out what the true cost is for these marketing tools they will revolt.
Any time a slick, MBA marketer tells you that he has a deal for you..........well, lets just say there is certain section in Wal Mart you better get to fast. Over in the corner in the health section.
It is not a perfect system. We don't the true cost of borrowing buy the manufacture. However, it is safe to assume that we can deduct a point or so off the standard rate. Let's say the standard rate is 8 percent. So, we give the manufacture a point break to get 7 percent. Now, take any finance program. Plug the payment in. Like 24K over 60 months at zero percent. (24000/60=400 per month). Now reverse the transaction and ask what is the current value of 400.00 per month over 60 months at 7%. You get 20,200.00. Difference of 3800.00. That is what the zero rate interest cost. Now, the problem is the MBA's have decided the the cash customer should shoulder some of the companies financing expense. I would guess a DSA on the about tractor to be around 1500 bucks give of take. So the cash buyer just paid more than the zero rate guy. If you have a late model trade in you get hosed as well. Also why your late model trade in is not worth much these days.
Yeah, the crack.....I mean low rate.....is killing the dealers and customers alike. But it feels so good and look how much money the MBAs are making off of "fake" money.
Tim
Any time a slick, MBA marketer tells you that he has a deal for you..........well, lets just say there is certain section in Wal Mart you better get to fast. Over in the corner in the health section.
It is not a perfect system. We don't the true cost of borrowing buy the manufacture. However, it is safe to assume that we can deduct a point or so off the standard rate. Let's say the standard rate is 8 percent. So, we give the manufacture a point break to get 7 percent. Now, take any finance program. Plug the payment in. Like 24K over 60 months at zero percent. (24000/60=400 per month). Now reverse the transaction and ask what is the current value of 400.00 per month over 60 months at 7%. You get 20,200.00. Difference of 3800.00. That is what the zero rate interest cost. Now, the problem is the MBA's have decided the the cash customer should shoulder some of the companies financing expense. I would guess a DSA on the about tractor to be around 1500 bucks give of take. So the cash buyer just paid more than the zero rate guy. If you have a late model trade in you get hosed as well. Also why your late model trade in is not worth much these days.
Yeah, the crack.....I mean low rate.....is killing the dealers and customers alike. But it feels so good and look how much money the MBAs are making off of "fake" money.
Tim
California
Super Star Member
- Joined
- Jan 22, 2004
- Messages
- 16,680
- Location
- An hour north of San Francisco
- Tractor
- Yanmar YM240 Yanmar YM186D
That's an excellent article. Everyone following the Farmtrac mess should read it.
