Yet Another Deere Discount

[MHarryE]

Ester day I received yet another Deere discount offering up to $16,000 discount in addition to regular trade in value if I trade my 90 - 135 HP Kubota built between 2007 & 2012 on a John Deere 6M. The first discount offer I received expired in February. The next one expired at the end of March. This one extends all the way to June 30. I wonder if they keep reissuing the offer due to lots of success. I have no interest in trading but although I keep getting the offers, but in any case my tractor does not meet requirements as its a 2013.

 

[Grateful11]

Been to an Open House this Spring and JD actually brought in several Kubota's for a comparison to their tractors. Most of the folks there were whispering like why are they doing this? One model they brought in actually beat the Deere in every comparison, bad idea on JD's behalf. To me it makes JD look a little desperate. One of the largest cattle operations not too far from here has nearly replaced all their JD tractors with Kubota's, most of their tractors are under 150hp. I asked them why and they said plain and simple fuel economy. They still have a couple Deere's for pulling a silage cutter and a fairly new Krone Big Pack baler. They have around a 1000 head of cattle.

 

[Paystar]

I notice LOTS of John Deere commercials on tv now too. The loss of sales and layoff's must be hitting home. They should just fix their quality and design problems instead of spending it on incentives and commercials.

 

[AxleHub]

Its important to recognize that "what was" is no longer "what is".

The quantity of sales related to farm equipment may be higher . . but the dollars per sale is greatly lower. A dealer or salesperson will tell you they are very busy . . . and that is true . . . but big equipment purchases are way down.

Many dealerships across the country are selling compact and sub compact tractors snd equipment . . . and some implements for bigger equipment . . . but sales of big equipment is anywhere from weak to butt ugly. The reasons are several but the biggest ones are farm commodity prices are not good and land values are dropping. Many crop farmers this year are just hoping to break even. Surely we've all seen rhe news.

Another reason is more manufacturers working to sell more choices to a declining demand. Farmers bought in 2011/2012/2013. Less in 2014 and far less in 2015 so far. JD and several others have seen their best market products drop like a rock.

Most dealerships in this area of upper MidWest have many smaller tractors and few big units in stock . . unless they are holding 2013 and 2014 big equopment still unsold.

There are many rebates across the board and discounts because there is desperation in too many inventories.

 

[MHarryE]

Farm prices have crushed the farm equipment market - except for livestock which is great. The Kubota tractors Deere is going after with their discount offer are ones suited for livestock operations so it may be targeting where AG money is still available. Still we got the discount offer for trading our largest Kubota but no such offer on our Deere and New Holland in the same power range. We had planned to replace our JD large round baler but the discount seemed ridiculous so it's going to go for at least another year.

 

[rScotty]

And I wonder if part of the problem is self-generated by Deere and Kubota too. Their machines were always good, but in the last 20 years or so it seems like all kinds of machinery has gotten much better. Regardless of the kind of machine, it seems to not only be more comfortable and on less maintenance....but the darn thing is still working like new for about twice as long as they used to. Why trade it in?
We all grew up trading evey few years so that we wouldn't risk an untimely breakdown. But production ag machines are noticibly more reliable today than they used to be. They are more economical to run, and the rate of new worthwhile innovations have slowed.

I see the same thing in utility tractors and construction machines. We have a wealth to choose from, and they run "good as new" far longer with less work and worry than they did when I was a kid.

The bottom line to the dealer isn't a pretty one. Because if it doesn't last longer than the competition he won't sell any at all. And if all it does is last twice as long as it used to do then the dealer is going to sell half as many.
Is this just me seeing this? Or am I imagining things....again ?
rScotty

 

[MHarryE]

And I wonder if part of the problem is self-generated by Deere and Kubota too. Their machines were always good, but in the last 20 years or so it seems like all kinds of machinery has gotten much better. Regardless of the kind of machine, it seems to not only be more comfortable and on less maintenance....but the darn thing is still working like new for about twice as long as they used to. Why trade it in? We all grew up trading evey few years so that we wouldn't risk an untimely breakdown. But production ag machines are noticibly more reliable today than they used to be. They are more economical to run, and the rate of new worthwhile innovations have slowed. I see the same thing in utility tractors and construction machines. We have a wealth to choose from, and they run "good as new" far longer with less work and worry than they did when I was a kid. The bottom line to the dealer isn't a pretty one. Because if it doesn't last longer than the competition he won't sell any at all. And if all it does is last twice as long as it used to do then the dealer is going to sell half as many. Is this just me seeing this? Or am I imagining things....again ? rScotty

The new ones are more reliable - that's a given. Trading is now often based on features like creature comfort, integrated tractor implement controls, auto-steer and the like. However if the price is down farmers can pass those by for some period of time. A couple years ago when prices were high, I heard a farmer say that the soybean price may be over $16 per bushel but he is budgeting based on $12. Now with soybean prices under $10 per bushel, further cuts are needed. New high dollar equipment is is one of the first to go because of the reasons you say - they now seem to run forever. If, however, there was a worldwide shortage and prices jumped to $18 soybeans and $6 corn, the dealers would struggle to find new equipment.