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Post by Woodbeef on Sept 6, 2002 14:43:46 GMT 1
How hard do the manufacturers push 1 to 4 year leases across the pond?
Massey seems to really push tractors,J D and CNH does with tractors and combines.
Only problem seems to be the dealers get stuck with the returns.
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Post by leemsutton on Sept 6, 2002 20:52:27 GMT 1
They are getting more popular woodbeef over here. They are not really pushed at us though.
Many people are taking on more land, on 3 year deals. If you need more machinery to do this then to purchase is not really an option as its very hard to 'right a machine off' over 3 years.
The contract hire/ lease deals offer you what you need. Recently we looked at a contract farming agreement for 3 years. There was no way we were going to buy anything so I got hire/lease prices for every bit of machinery that we would of needed.
It proved to me that it is a far better way of bugeting as you know exactly, down to the last penny/cent, what your machines cost to operate on a per acre basis.
However on your owned land which you know you will still have in 8 years time it is cheaper to buy and service it yourself.
Lee
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Post by Jon B on Sept 15, 2002 0:23:56 GMT 1
I got talking to a few people on this issue the other day at the Outdoor Farm Show. One person was a salesman for Gregson Sprayers. And the other was our beloved Woodbeef himself.
I got talking to the Gregson salesman about the air boom sprayers, and how they compare to AI tips. The air boom still works best for reducing drift. He said that the inital price of the machine is high, but once you own it, the costs stay the same to that of a regular sprayer, even a 15 year old machine.
The discussion that woodbeef and I had was really interesting, from the aspect that most Europeans buy a new machine for 10-15 years, not like North Americans, where they have it for 2-3, and if not 5-8 at the most.
The stuck with returns was interesting, which really throws off sales numbers. If Deere sells 15,000 8420 tractors, and they have 14,000 8410 tractors that were returned on "roll" deals, Deere still says they sold 15,000, despite they only gained 1000 sales.
A few weeks ago, there was a huge auction in North Dakota - I think there were 16 CIH 21-2388's, 9 9610-9650's, lots of MX and 8000 series tractors. Basically 2-3 year old machines. And these are all lease returns that the dealer can't get rid of.
Its an interesting subject - that a lot more could be said about
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Post by leemsutton on Sept 19, 2002 10:26:35 GMT 1
Jon Bos,
Most Europeans buy machinery for no more than 5 years and we here in the UK canbe even worse and off load it after 3. However now that agriculture is going through a tough time we are all looking at longer term deals etc.
Our latest purchase will be here for 10 years and hopefully should of completed about 10000 hours before we even consider changing it.
Lee
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Post by Friedhelm on Sept 19, 2002 11:11:26 GMT 1
Lease looks first of all interesting to customers. You pay monthly for using it and not more, after 3 years you lease a new one and everything is fine.
For the financial situation it also in certain cases is the better way to get new machinery, but buying often is the better way. That at least is what I hear from customers and tax advisers here in Germany.
Lease rates are influencend by a lot of factors. The biggest is resale value.
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