New farm tractor and combine sales continue to lag in after a slowdown that started the previous year, according to the latest report from the Association of Equipment Manufacturers.
Soft sales led savvy dealerships to focus on service and aftermarket upgrades such as precision agriculture technology, said Curt Blades, AEM vice president.
SS Equipment New Holland, headquartered in Pasco, Wash., focused on deals with winter overhaul programs, said Jay Herbers, corporate sales manager. The economy has been tight, limiting sales of tractors, combines, swathers and bailers, he said.
“The biggest thing in this economy is selling your business as a whole,” Herbers said.Salesmen need to promote the dealership’s parts and service out in the field.
Chad Hochstetler, general manager for Rickreall Farm Supply, a Kubota dealership in Rickreall, Ore., said farmers and ranchers were making investments in their existing equipment.
“People are trying to be resourceful,” he said.
In some cases, that means seeking versatility and using tractors as “Swiss Army knives.”
“How can we make our tractors do more things? That’s some of what is occurring in the market right now,” Hochstetler said.
Hochstetler was hopeful sales would improve in the third and fourth quarter of as agricultural uncertainty regarding trade and other matters is resolved.
Herbers said there was optimism.
“When you’re able to get a quote to a guy, it’s trending upwards,” he said.
Farmland Tractor in Tangent, Ore., sells tractor parts and when the economy is tough, parts sales increase, said Ty Raschein, whose family owns and operates the business.
“Nobody is buying new, they’re fixing old, so that’s better for us,” he said.
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Raschein said margins are tight across the country, including in Linn County, Ore., where grass seed isn’t moving.
Blades said uncertainty, higher input costs and higher interest rates continue to hamper tractor sales.
Preliminary data also indicates that the fleet age for tractors and combines is relatively young, with many farmers, ranchers and rural residents making larger purchases within the past eight years.
During the pandemic, for example, dealerships experienced record high sales of tractors less than 40 hp as people were stuck at home.
Combine sales are sharply down, but were strong just a few years ago thanks to advancements with precision agriculture.
AEM data showed sales of tractors from 40 hp to 100 hp suffered the smallest percentage drop year-to-date in .
Herbers said mid-range tractors sales for machines from 75 hp to 100 hp were decent, in part because ranchers use those machines and beef is a hot segment.
Hochstetler said the sweet spot for sales at Rickreall Farm Supply was from 40 hp to 80 hp.
“It isn’t bad. It’s down slightly,” he said.
Total farm tractor sales through May hit 80,332, down 12.8% from the first five months of .
Self-propelled combine sales — measured as a separate category by AEM — were down 43% to 1,253 year-to-date.
In , tractor sales fell 13.2% compared to the previous year, while combine sales dropped 24.3%.
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