Published April 02, 2008 11:06 am -
TRACTORS FOR SALE
For sale: 902 Farmtrac tractors at a great price. That's one of the options offered to the public by a liquidation Web site late Monday.
The online clearance Web site comes nearly three months after financially embattled tractor manufacturer Farmtrac North America (FNA) closed its doors to employees to reorganize. It is also more than 180 days behind on its debt of more than $14 million to Atlanta, Ga.-based Textron Financial.
Attorney Jim Marrow of Tarboro, who assumed duty Feb. 27 as the Edgecombe County court-appointed receiver, was asked about the online offering.
Marrow said that rapidly selling the tractors at "fire sale prices" is "an unenviable and last option," and that efforts are in place to shape up the company's books, inventory and hardware enough to attract a buyer.
"That is ultimately is the best solution to maximize value," he said.
The function of a receiver is to ensure payment of debt to creditors. In the case of six-decade old Farmtrac, it is also to repair the company's reputation and prevent it from perishing.
"In essence, I am now the owner of Farmtrac," Marrow explained. "I'm aware many people are hurt in this ... and that we've got to act quickly."
Marrow claimed he had no knowledge about a liquidation site operated by LewPack International of metro Atlanta prior to faxes and e-mails from Farmtrac retailers across the country with Web site information, a page hosting 19 different models of Farmtrac tractors.
There are approximately 700 partly-assembled and 250 completed tractors on Farmtrac locations in Tarboro.
In further conversation, the receiver attributed the online sale attempt to a "miscommunication" between two undisclosed parties. "They were contacted (Tuesday) and the Web page is no longer in service," Marrow said.
LewPack's Farmtrac sales page, lewpackinternational.com/tractors.html continued to be in full operation at the time today's newspaper had gone to press.
In addition, a Middle Eastern competitor Web site, Vivastreet.co.in, is also offering the multitude of Farmtrac products for sale. The listing was posted on Sunday by co-owner of LewPack International, Bobby Pack.
In conversations with Pack, he offered tractors at rates thousands of dollars less than dealer cost. "It's a close out for a U.S. distributor," Pack said. "We're liquidating all of it."
Since late February, Marrow has appointed a barebones management and administrative staff back on duty at its headquarters building on 111 Fairview St. to wade though a sea of backdated paperwork and "get a good picture of what's here."
Disheveled bookkeeping and a lack of hardware inventory are issues that Doug Gurkins of Washington, N.C., a veteran property and land evaluator, has reported to Marrow.
Transactions that are four or five years old, partly cannibalized tractors used for parts and dislocated tractors are a handful of examples that represent the mess Marrow inherited.
"One tractor was taken to a farm show in Louisville, (Ky.). Instead of bringing it back afterward, it was left at the nearby retailer," Morrow said. "At $30,000 a pop, that can add up pretty quick."
The tractors are spread across nearly 300 Farmtrac dealerships across the U.S. and Canada, plus three different properties (production and storage) in Tarboro.
The lack of a tractor warranty program is a large and essential obstacle that must be conquered if the firm has any chance to be successful. In some states, law requires a warranty with "new" tractors. Numerous dealerships have reported that customers are unwilling to pay full price for a tractor without protection against breakage.
"It could be the difference between failure and success" of retaining dealers and customers, Marrow said.
Negotiations are under way and Marrow as "two or three" potential third-party tractor warranty and maintenance companies, one which could be approved "within seven to 10 days."
Marrow also stressed that quick actions are also critical.
"We will lose a lot of brand value if we let it linger," Marrow said "and the selling season is ending rapidly."
On Jan. 18, the Fairview Street location was closed and approximately 180 workers were sent home while company leadership regrouped. The workers are still in limbo and under temporary layoff.
The workers, presently on temporary layoff, are allowed to collect unemployment without being required to seek out new work. Once displaced workers take on a permanent layoff status, they become eligible for federal re-training and back-to-school programs. It is a wait that, depending upon Farmtrac, could last for up to 24 weeks.
Although Farmtrac employees voluntarily gave five to six hours daily during the plant closing in an effort to continue basic parts and phone support, numbers and support fizzled.
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Photos
At the Farmtrac assembly plant in Tarboro, rows and rows full of partially assembled Farmtrac tractors await a buyer. Between a sluggish economy, the company's January closing and lack of a tractor warranty program, the units may become part of a liquidation sale. Staff Writer
