John Deere signed a memorandum of understanding (MOU) on Jan. 8, 2023, with The American Farm Bureau Federation (AFBF) that “ensures farmers’ and ranchers’ right to repair their own farm equipment.”
John Deere was part of the MOU that the Assn. of Equipment Manufacturers, the Equipment Dealers Assn. (now NAEDA) and many of the farm equipment manufacturers signed in 2018, says Kim Rominger, president & CEO of the North American Equipment Dealers Assn. (NAEDA).
“The major ag manufacturers were all in agreement that was a good MOU. I think this MOU goes into a little greater detail into what is available to the customers. In addition, it goes into greater detail in the instance of a code that basically shuts down the equipment so it doesn’t do any more damage and how they have wording in there that a situation like that will get increased attention,” he says.
The announcement has heightened some concerns from dealers of all colors, ranging from the increase in in-coming calls to the service department to the impact on trade-in values and safety.
“There are several concerns, the flood of incoming calls for us to interpret what the customer thinks they see on the codes, asking for a fix. This will likely increase our incoming phone calls tenfold,” says Brad Bowman, vice president and branch manager for Star Equipment in Cedar Rapids, Iowa. “It will also cause service call issues and arguments when we go there and their diagnosis is incorrect, resulting in more hard feelings and arguing about the repair bills.”
For Parallel Ag, the impact on trades is a top priority.
“The high priority question for our dealership is the trade-in value of the unit that has been manipulated by people with no experience of any kind. Are they trading units because they did something that has made it not operate correctly?” says David Smith, technology professional with 11-store AGCO dealer Parallel Ag.
“If we trade for the unit and it burns the engine up prematurely, does the next customer have to pay for that? If it’s under warranty but has been changed outside of manufacturer settings, will warranty cover the repair? How do we keep people from changing the operation of systems that have been built to cut down on pollution and require stiff penalties and fines if found they have been changed?”
Smith also points to the safety of salespeople, techs and the customers who may be around a unit after modifications that could make it operate in an unsafe manner.
“This issue is deeper than someone not being able to repair their tractor. Customers are able to perform all repairs needed to their units except for about 2% of the repairs. That 2% is the most important to the safety of all people involved,” he says.
Tom Nobbe, an owner with 27-store Deere dealership Sydenstricker Nobbe Partners, echoed this sentiment in an article he wrote for Farm Equipment.
“What dealers and manufacturers don’t want is to provide customers and independent repair shops with the ability to access embedded codes and modify critical settings, potentially allowing unsafe machine operation or modification of federally mandated emission controls. On Deere equipment, the critical repairs that customers can’t perform themselves amount to less than 2% of the repairs done on the equipment, and they are the ones that effect safety and emissions,” Nobbe says.
Wayne Fischer, director of parts service & technology for Case IH dealer Torgerson’s, says customers have been misled to think that with an electronic service tool the doors will be open to repair equipment quickly and efficiently.
“Our best trained technicians have issues and they use the product on a daily basis — there is no Easy Button that fixes an issue. Diagnostic and troubleshooting is still part of the process. The other issue is cost — once producers see the investment in time and dollars, most lose interest.
“I foresee customers getting into situations changing perimeters and setting and making their issue worse, then being even more upset when it takes additional hours for a dealership to correct,” he says.
A number of dealers echoed the sentiment that customers don’t fully understand what they are asking for with right to repair, including Nick Rust, precision ag coordinator for H&R Agri-Power.
“If a customer wants to pick up an EST (Electronic Service Tool used for Case IH electronic diagnostics) and use it, I say that’s great. I don’t really think they understand what they are asking for,” he says. “The tool is complicated to use, and I have master service techs who don’t fully understand how to use the tool. To be a master service tech, they have been through 100s of hours of training. Is a customer, shade tree mechanic, etc., going to come in off the street without training and be able to do much? I think the answer is no.
“The big question is, how are the customers buying this tool going to get educated and trained properly on how to use it? I know from personal experience, you can disable a tractor or brick a controller if you load the wrong firmware on a controller. It’s not exactly idiot proof,” Rust says.
James Schott, owner and president of Miller Implement in St. Nazianz, Wis., is concerned about the safety and liability issues but also the economic impact it could have on the business.
You can find our latest coverage on Right to Repair online at www.Farm-Equipment.com/R2RUpdates
“Does this make my dealership null and void of the OEM’s requirement that I pay to have my techs factory trained?” Schott says. “I wholeheartedly agree this is going to be not only an economic issue for struggling dealerships but a huge safety and liability issue for anyone dabbling in the software side of repairs, not to mention high pressure common rail systems that are significantly impacted by this software. These systems, if not handled appropriately, can literally be lethal if tampered with. OEM warranties need to be allowed to be voided to any consumer who purchases said software for any of the equipment he currently owns or purchases in the future.”
Poor Farmer Reception
The National Farmers Union, which represents almost 200,000 growers, told its members the MOU between Deere and AFBF is “riddled with potential loopholes.”
The group says, “It requires independent mechanics to jump through hoops to acquire these repair materials. John Deere can also walk away from the MOU with 30 days’ notice, which doesn’t provide any assurance that the deal will be honored.”
The National Farmers Union will continue to advocate for right to repair legislation, the group says.
The Repair Assn. Addresses Potential Dealer Concerns Over MOU
* Software in the hands of competitive major-line dealers as well as independent shade tree mechanics. And if 20-year trained OEM service techs struggle with the complexity of the software, how will the customers learn it and from whom?
A. The MOU appears to allow customers and independents to get training. It remains the choice of the farmer whom to trust to help them — and training is a big part of that choice. Highly qualified and effective mechanics are going to be in high demand and should be a marketing advantage for dealerships.
* Dealer-educated service techs leaving the dealership to become “independents,” many unaware of liability and other issues extending far beyond the immediate work order.
A. We can project from the auto industry how independents might go into business. Most independent auto mechanics start with dealerships and build their skills before going out on their own. Business formation is very common and well supported by local chambers of commerce, NFIB chapters, and there is a whole legal and insurance industry devoted to supporting small business formation. Dealers should not be concerned about the legal liability issues of competitors as a failure of a competitor is an opportunity for dealership growth.
* A disastrous mess that farmers are likely to discover over voided warranties, creating additional factures in the customer-dealer-manufacturer ecosystem. How will recourse be handled at the local level (where the machine was purchased) when the major OEM is saying “no?”
A. This concern has little to do with the MOU or even any legislation. We can look to the auto industry again for guidance. Car owners do try to get equipment out of warranty serviced under warranty, but dealers are gatekeepers and do refuse as the OEM will not pay them to provide the service. Maybe dealers just need to be clearer with their customers about coverage limits.
Current federal law regarding warranties – the Magnuson-Moss Warranty Act — references “consumers” and some OEMs may choose to limit warranty service to “businesses” but at some legal risk. The FTC may provide some future clarity, as might the U.S. Congress, but for now it is unlikely that a producer is going to pay to hire an independent for a service that would otherwise be covered by warranty. If an equipment owner botches their own repairs, it is a revenue opportunity for the dealership if the owner damaged warrantied parts, but not if they damaged parts not covered by the warranty.
— Gay Gordon-Byrne, Executive Director, The Repair Assn.
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