New or second-hand tractor?

Buyers use finance to step up to new machines


ANFD News
John Lamb, of Weir and Harrod Machinery, said a lot of customers had questions about the benefits of a new machine over buying second-hand.

John Lamb, of Weir and Harrod Machinery, said a lot of customers had questions about the benefits of a new machine over buying second-hand.

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Loan structure critical to helping farmers into new machines during poor season.

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With a range of finance options available, plus warranties and after sales service, more farmers are going for a new tractor than for a second-hand machine.

“I think the days of going and finding an old Ford 5000 are gone – they’re just getting too hard to find,” says Peter Nixon of Forbes Machinery Centre.

He said Ford 5000s were becoming sentimental favorites that have collector interest, so are no longer being traded as much.

Cost and access to parts were also becoming more difficult and he said new machines were far more convenient.

New Holland business manager, Matt Amery, who was also on the New Holland site at the field days, agreed.

Another attraction had been that the loader and other attachments were tax deductible, Mr Amery said.

CNH Industrial Capital national sales manager for agriculture, Aaron Bett, Sydney, said he had seen continued strong demand in the past two-and-a-half years for machines up to 104 kiloWatts (140hp).

“It’s holding up in NSW and Queensland, despite the conditions. A lot of these are going to livestock fellas because they’re feeding out more,” he said.

While low interest rates were still available, he said it was the loan structure that was helping farmers get into new machines.

He said with a lot of farmers not harvesting a crop this year, and therefore not receiving a payment in March-April 2019, the company, which offers finance for New Holland machinery purchases, had structured its loans to allow for later repayments.

“We do have high levels of understanding of the poor seasons and can structure loans and repayments around this,” Mr Bett said.

He said it was sometimes hard for farmers to talk about finance when they had disrupted cash flow, but it was worth asking what options were being offered.

John Lamb, of Weir and Harrod Machinery (WHM), a 105-year-old company from St Marys, said the running cost was also a big deciding factor in purchasing a new machine.

He had on show a range of WHM’s tractors, which he said ranged in size from 36 kilowatt (48hp) up to 75kW (100hp).

“A number of people have come and talked about second-hand tractors,” he said.

“If you buy a new tractor you’re getting a warranty, you’re getting almost guaranteed longevity, so if a second-hand tractor is $20,000 and a new one is $30,000, they’re more likely to pay the $30,000 to get the new one.”

He said people were using the finance options to go that bit further. 

“(The finance) makes the difference between buying and not buying,” he said. WHM partners with Victory Finance.

“What we find is important with the finance company is it understands the farming market and machinery as distinct from the general finance broker who is an all-rounder and doesn’t have that particular knowledge to pick out key parts of the (farmer’s) income stream,” Mr Lamb said.

WHM has manufactured industrial goods for all its 105 years, and 15 years ago branched out into tractors.

Its tractors are designed and engineered in Australia and put together in China under its specifications and quality control.

“We believe they are distinctly different from the average Chinese-made tractor where the importer goes to China, buys a tractor from a factory and then sells it here,” Mr Lamb said.

“We impose very strict quality control on the input of goods, we specify where the components are to come from and we work out the manufacturing process to make sure it is all adequate.”

He said the company’s target market consisted of two distinct segments, one being the lifestyle/retired farmer and the second was those seeking a second tractor - the all-purpose, cheaper-to-run tractor for the farm.

“What we’ve found with two or three of our inquiries here, and also a lot at Henty and Murrumbatemen (field days) from the broadacre farmer is they say, ‘look, I’ve got a 150hp tractor. It costs me a lot to run, so what I want is a cheaper tractor that I can just hop in to run the augers or do the hay rake, that probably is a third of the cost to run per hour.”

He said right now sales were good, but there was some concern with the season there may soon be a tractor drought.

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