South Central MN | Pat H - 11/13/2023 09:20
I suppose the cost to make an upscale combine is the same way. Larger rotors is an incremental steel cost. The engine costs more, but not double. I would guess the profit margin is substantial as the class number increases.
Its not just the material cost. You need new jigs and fixtures for the bigger parts. You need new molds for castings. You need different inventory and assembly management to handle bigger parts. Production line might need to be upgraded.
All of that overhead then gets expensed over relatively low production for the mega machines. You're still probably right that the margin is better, but it won't be the slam dunk you were thinking. |
New Holland CR11
