mn | usafarmer - 5/22/2016 12:05
"equipment that has rapidly depreciated in value"
I thought Deere equipment did not rapidly depreciate??????*
Maybe the fenced in 160 acre story is true?????*
I don't think Deere is the only one with rapid depreciation problems.
And I also don't think commodity prices are completely to blame for rapid depreciation.
I believe that manufacturers making extremely large equipment is a good chunk of the depreciation issue.
Here is my thinking. Large farmer purchases a new 36 row planter. Uses it until the warranty is gone and trades it in for another new one. When times were good, maybe every year. That planter is much too large for any small to medium farmer that would be in the market for a used planter. A farmer that can justify a 36 row planter wants one with warranty and generally wont buy a used one (understandably). So who is there to buy all these big used planters? Will they sell? Sure. Once they get cheap enough. That's where the rapid depreciation comes in. Same theory goes for combines, SP sprayers, some tillage, and some large tractors. Add that to a market that is already extremely flooded with large used equipment and depreciation hits pretty fast.
I know this isn't the entire cause of the problem but its sure not helping. :) |
Deere tightening leasing terms
