Value of a Kubota down the road

[DonaldP]

Two questions:

What is that 2012 dollar worth in 2021?
How much would an apples-to-apples replacement for your MX cost today?

Rick, thank you for responding withe obvious. I love when folks reply with “the rest of the story”.

1 to 2 % per year… that’s 9 years for Step’s machine, or 12 to 13 percent.
MSRP in 2012 was $23165, now it’s $26931 plus $1200 for the 3rd function. I’m not thinking that maintenance was included in Step’s numbers….

Add inflation to those dollars in 2012 to now at 13% is $26176, (which is about what the Kubota MX5100 is new today).
Total that all up and what you get is the cost of ownership compared to resale value.

So if Step got $23,000 for his 2012 machine today, then it actually cost him about $28,100 in today’s dollars instead of the $23,165 of MSRP in 2012.

So he actually only spent $5000 or so to own the MX5100 for 9 years (plus whatever he spent on maintenance). But the true capital investment minus the return still sits at about $5000 if my calculations are close.

So the question isdid Step buy another Kubota? Did he trade it in?

If he took the resale value and pocketed it because demand is high right now, and he then buys another tractor now, then it’s very possible the $5000 or a portion of it will go into a replacement at a higher cost due to demand right now even with new. Today is a no haggle period due to demand so he may loose any gain he made on selling at the top of the market for sellers as he may also be a buyer right now at higher retail prices.
If he waits… he might actually keep that resale windfall!

 

[DonaldP]

With respect to to hours ona machine and Step…

….
I’ve had my 3650 since July 22, 2020… I have 367 hours on it. I’m not a contractor. This is my personal machine.
I suppose that I’m finding way too many things to do with the 3650 and I’m using it and gaining experience with it. I have more experience with my 3650 in 12 months than Step had in 9 years on his MX5100.

I can’t imagine the expense of an MX 5100 in 2012 of $23,000 and to then put less than a half hour a week on it. That is like mowing 1/4 acre a week. A cub cadet would do that for $2000 …

I just can’t understand that.. to not use it for 9 years, and then be happy that only $5000 was spent for it. Even that is $3000 more than the cub cadet option.

If he had added anything to make a rental comparison viable… a backhoe, or other implement that would have allowed him the option of comparing renting the equip once a year for $800/rental… but then again, that would have added to the investment he had made in the equipment either in the beginning or throughout it’s life. …. But then yes that would have saved some money in 9 years over renting the equip . That information on implements that he owned or used is lacking in his outline.
it would be interesting to get more feedback from Step…

 

[Hay Dude]

Just to throw a little more wood on the fire. I bought a New Holland baler in 2010 for $24,000. I sold it in 2020 for $14,000. So I “lost” $10,000.
But wait, I made 5,000 tons of hay with it. At an average price of $150/ton, I made $750,000 worth of hay. Paid taxes on the income.
Still have the tractor that pulls it. Maybe spent another $5,000 in repairs, grease, net wrap, etc.
How did I do?

 

[kantuckid]

The IRS can answer your question?

 

[fried1765]

Just to throw a little more wood on the fire. I bought a New Holland baler in 2010 for $24,000. I sold it in 2020 for $14,000. So I “lost” $10,000.
But wait, I made 5,000 tons of hay with it. At an average price of $150/ton, I made $750,000 worth of hay. Paid taxes on the income.
Still have the tractor that pulls it. Maybe spent another $5,000 in repairs, grease, net wrap, etc.
How did I do?

That's a mighty fine return for grass mowing!

 

[fried1765]

With respect to to hours ona machine and Step…

….
I’ve had my 3650 since July 22, 2020… I have 367 hours on it. I’m not a contractor. This is my personal machine.
I suppose that I’m finding way too many things to do with the 3650 and I’m using it and gaining experience with it. I have more experience with my 3650 in 12 months than Step had in 9 years on his MX5100.

I can’t imagine the expense of an MX 5100 in 2012 of $23,000 and to then put less than a half hour a week on it. That is like mowing 1/4 acre a week. A cub cadet would do that for $2000 …

I just can’t understand that.. to not use it for 9 years, and then be happy that only $5000 was spent for it. Even that is $3000 more than the cub cadet option.

If he had added anything to make a rental comparison viable… a backhoe, or other implement that would have allowed him the option of comparing renting the equip once a year for $800/rental… but then again, that would have added to the investment he had made in the equipment either in the beginning or throughout it’s life. …. But then yes that would have saved some money in 9 years over renting the equip . That information on implements that he owned or used is lacking in his outline.
it would be interesting to get more feedback from Step…

It doesn't always have to be about expense v/s return on investment etc.!
There comes a time in life when $ practicality no longer matters!
At 80, if I want it, and can afford it, I get it!
I have a maxed out accessoried (no cab), 253 hour L48 TLB, that I bought two years ago,( today, maybe worth $40K? ), that I have used for TWO hours in the past year.
Why do I have it?
Because..... I LIKE IT!

 

[DonaldP]

It doesn't always have to be about expense v/s return on investment etc.!
There comes a time in life when $ practicality no longer matters!
At 80, if I want it, and can afford it, I get it!
I have a maxed out accessoried (no cab), 253 hour L48 TLB, that I bought two years ago,( today, maybe worth $40K? ), that I have used for TWO hours in the past year.
Why do I have it?
Because..... I LIKE IT!

You are soooo right! Life is that way. I’m there myself in many ways.

I think I just got carried away with the fact that someone bought and sold it under the guise of loosing very little money on their investment, when actually the use of the machine was outside of the average consumers experience. Thank you!!!

 

[DonaldP]

That's a mighty fine return for grass mowing!

Well put!!!!

 

[Gale Hawkins]

Inflation tends to lift all non leaking ships. Sooner or later like everything tractors get past down to family or hit the market.

I read somewhere between 50 to 100 trillion dollars are due to be transferred to heirs in the USA sooner than later.

Will this impact the used tractor supply and demand?

 

[fried1765]

Inflation tends to lift all non leaking ships. Sooner or later like everything tractors get past down to family or hit the market.

I read somewhere between 50 to 100 trillion dollars are due to be transferred to heirs in the USA sooner than later.

Will this impact the used tractor supply and demand?

Maybe......but after I have croaked.....will I really care?