Tractor Tip of the Week September 16-22
How much is that tractor worth? That depends upon the market and the tractor. Historically, tractors do not depreciate very much compared to other products. This is due to a number of factors.
Older tractors have, traditionally, held their value well. Are these tractors worth the price? Most old tractors are two wheel drive. Many do not have power steering. Most do not have ROPS. Many brands do not have a three-point hitch.
An older tractor with out a three-point hitch is of limited value. This tractor cannot run most modern implements and is an antique. If the tractor has a three-point hitch and power steering it is a candidate for running implements and a loader. It will need a substantial counterweight to offset the loader. Safety is still a consideration. Does it have ROPS and a seatbelt?
The primary reason we see tractors retaining their value is due to their condition and a lack of use. The typical trade in has 1,000 hours and is 10 years old. This is similar to a 10-year-old car with 30,000 to 40,000 miles. Of course that car, or tractor, is worth a premium.
Demand and supply also play a role. The number of good, used, 4 wheel drive tractors with loaders available is minimal and demand is strong.
The cost of any repairs will need to be factored in. Are the tires serviceable? Does it need paint? Does everything function properly? Are there any leaks? What type of warranty is included with the used tractor?
Is financing available? What interest rate and payment? Many times financing a new tractor is more attractive than a used tractor, due to low APR financing and little or no down payment.