In this episode of On the Record, brought to you by Associated Equipment Distributors, we look at how used dealer and auction prices are trending. In the Technology Corner, Noah Newman shows up Trimble’s new Bilberry Smart Spraying System. Also in this episode, dealers report few department manager retirements coming, AGI earnings, the Farm Equipment Hall of Fame and Mahindra's North America CEO talks 2024 market share goals.

This episode of On the Record is brought to you by Associated Equipment Distributors — the leading association in North America strictly dedicated to the equipment distribution industry.  AED offers a wide range of education, events, advocacy and reports for companies of all sizes and all roles within your organization.  Learn more about AED by visiting www.aednet.org/agdealers

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• February Used Equipment Pricing Mixed at Auctions & Dealer Lots
• Dealers on the Move
• Trimble’s New Bilberry Smart Spraying System Embodies Retrofit-First Mindset
• Dealers Report Few Department Manager Retirements in Next 3 Years
• Farm Equipment Launches Inaugural Dealer Hall of Fame
• AGI Reports 5% Improvement in 2023 Revenues
• Mahindra CEO: We Want Long-Term, Family-Owned Dealers
• DataPoint: Manure Application Methods

February Used Equipment Pricing Mixed at Auctions & Dealer Lots

Used equipment auction pricing remained challenged in February, according to a March 6 report from Stifel.

According to the report, auction prices for combines and over 300 horsepower tractors remained positive year-over–year, while smaller ag equipment was more mixed. Inventory levels have generally improved but remained too high on the small ag side.

Used equipment auction pricing was up 1% year-over-year for combines and up 4.2% year-over-year for over 300 horsepower tractors. Pricing was down 3.7% for 175-299 horsepower tractors and down 0.5% for the 100-174 horsepower range. Tractors with 40-99 horsepower and under 40 horsepower both saw 3% year-over-year declines in used equipment auction pricing.

Looking at what dealers said, the latest Dealer Sentiments & Business Conditions Update found used pricing for both used over 100 horsepower tractors and used 4WD tractors were up 1% in February. Pricing for used combines, however, was down 4% year-over-year.

On the small ag side, used tractors in the 40-100 horsepower range saw no change in pricing, while tractors under 40 horsepower saw a 2% decline in used pricing.

In the latest update, one dealer said that “Customers are taking a much more conservative view of the economy and taking a wait and see position.”

Dealers on the Move

This week’s Dealers on the Move include Linder Industrial Machinery, Ohio Valley Ag and Sydenstricker Nobbe Partners.

Kubota and Deutz-Fahr dealer Linder Industrial Machinery Co. has acquired Southern Tractor & Outdoors. The 3 branches in southwest Georgia — Leesburg, Moultrie and Valdosta — will be rebranded as Linder Turf & Tractor branches. Ohio Valley Ag, an Apache dealer, moved its original Owensboro, Ky., location in February to a new building 4 miles away. John Deere dealer Sydenstricker Nobbe Partners announced March 5 it had broken ground on a new location in Waterloo, Ill. Sydenstricker Nobbe Partners also announced March 13 the upcoming acquisition of all 10 Cazenovia Equipment locations in New York.

Trimble’s New Bilberry Smart Spraying System Embodies Retrofit-First Mindset

Today we’re spotlighting Trimble’s new see and spray technology. It’s called the Bilberry system — a camera-based system that enables farmers to save up to 90% on herbicide applications by only spraying where the weeds are in the field. And as Trimble’s Cory Buchs tells us, one of the best things about it is it retrofits to existing sprayers.

“That’s a huge differentiator of our Bilberry system. Our system is made to be installed on your existing sprayer, so you don’t have to buy a new machine. It can also work with your existing application control systems. You don’t have to pull all off of your existing technology off the sprayer and replace it. We can tie into what’s already there and command the nozzles through your existing system, which ultimately as a farmer saves you a lot of money and reduces the barrier to being able to adopt this technology.”

“In the ag tech space, there’s a lot of innovation happening, but for a lot of systems you have to buy a new machine. That’s a huge investment toward any farm. Most farms can’t afford to roll all of the machines in their fleet every 2-3 years, which is ultimately what a lot of technology companies and OEMs are asking farmers to do to keep up. With the Bilberry system and with a lot of things that Trimble offers we’re ultimately focused on enabling you as the farmer to adopt that technology without buying a new machine.”

The Bilberry system is testing in 10 countries and has systems running in North America this growing season. Corey says Trimble hopes it will be available for sale later this year or early 2025.

Dealers Report Few Department Manager Retirements in Next 3 Years

A March 5 Farm Equipment Insider poll asked dealers what percentage of their dealership's department managers will be retiring in the next 3 years.

While 20% of dealers say at least 21% of their department managers will be retiring in the next 3 years, 70% report only up to 10% will be retiring in the next 3 years.

Farm Equipment Launches Inaugural Dealer Hall of Fame

In its record-breaking February issue, Farm Equipment announced the 11 inaugural members of its Dealer Hall of Fame.

The inaugural class honors key industry figures from 9 dealerships, highlighting the innovative best practices they contributed to the world of ag equipment. From deceased Oliver tractor dealer principal Orhan Yirmibesh — who is credited as one of the first dealers to capitalize on leasing — to Titan Machinery legends David Meyer & Peter Christianson, the report catalogs the challenges and triumphs that build some of the industry’s most successful dealerships.

You can read the full report on the Farm Equipment website.

AGI Reports 5% Improvement in 2023 Revenues 

2023 marked the fourth straight record year for Ag Growth International (AGI). The Canadian shortline manufacturer reported its fourth quarter and year-end results on March 5.

For the quarter, AGI’s revenue was up 1% year-over-year to $379 million. During an earnings call with analysts, Paul Householder, president and CEO of AGI, said the improvement was supported by growth in the company’s farm segment, but growth was impacted by steel costs generally trending lower year-over-year. Householder said had steel pricing been constant, revenue levels would have been approximately 5% higher than the prior year.

For the full year, AGI reported revenue of $1.53 billion, up 5% year-over-year. Revenue generated from AGI’s international business contributed to over $500 million, or 34% of total revenue. Householder said the company is focused on growing its international business, with a medium term target of 40–45% of the total revenue mix.

Looking at 2024, Householder said AGI is optimistic noting the farm segment order book continues to trend higher year-over-year.

Mahindra CEO: We Want Long-Term, Family-Owned Dealers

At this year’s National Farm Machinery Show, we caught up with Mahindra North America President & CEO Viren Popli to talk about his goals and concerns for 2024. He said the company wants to expand market share but is being “very careful” about which dealers carry the Mahindra brand.

“In terms of dealer network, our dealer network in North America is about 450. If you compare that to much of our competition that's over a thousand. So we have a lot of wide spaces in between, right now, to add more dealers, but we just want to be very careful about who we appoint as a dealer.

“In terms of dealer network, our dealer network in North America is about 450. If you compare that to much of our competition that's over a thousand. So we have a lot of wide spaces in between, right now, to add more dealers, but we just want to be very careful about who we appoint as a dealer. We are not looking for a sales point. We want a ‘3S’ dealer. We want a dealer who can do sales, service and spare parts. Because if you can't do all three, then you're not my dealer, you're just a sales point, and that's not what we are looking for.”

Popli said the company actively seeks out family-owned dealerships and avoids larger, corporate dealers, which he says is better for the end-user.

“We actively seek out family-owned businesses. So we are actually turning the tractor sales model on its head as compared to where some of our competition is going. We believe that the old style where the family-owned business ran the dealership is actually the best way to be because it may not be the best way for me as a company, but for my customer it's the best way.”

Mahindra also recruits dealers, he said, from people leaving the larger dealerships.

“In fact, we are getting a lot of people who were in that space [larger, corporate dealerships], and are now wanting to be part of us, because they no longer have the opportunity to do what their families have done for generations. So that's the way it's working for us. It, actually, is working in our favor, in a sense, if I'm looking at that. Because I get a family who's been in this space for 50, 60, 70 years, has the relationships, has everything, but doesn't have a business, and we offer the business to them.” 

Looking beyond 2024, Popli says Mahindra is looking to take a “significant position” in the small tractor arena in the next 2 years and expand its implements and attachment business.

DataPoint: Manure Application Methods

This week’s DataPoint is brought to you by the 2024 Dealership Minds Summit.

Between 2013 and 2019, the leading manure application method for farmers of major field crops was to apply manure to the surface without incorporating it  — the simplest method in which manure is flailed or sprayed out of wagons and left on the ground. This method was used on 8.3 million acres, including about 6 million acres of corn. Surface application with incorporation was the next most common method, used on 5.5 million acres.

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