Fluctuating exchange rates can create a real quandary for equipment dealers in Canada. As an Ontario New Holland dealer explains, “Roll programs in a shrinking agricultural machinery market definitely have a positive impact on machine populations and resulting market share results. However, they often come at the expense of margin due to a very unstable value of the Canadian dollar. The resulting change in the value of a new unit over a 12- or 24-month window may leave the dealership with a used piece coming back into inventory that was sold at a higher exchange rate than a new unit today,” he says.

“This can lead to an overpriced, hard to move trade or a trade difference too great to maintain the roll program with a customer becoming comfortable with a predictable ownership cost over the historic roll period. A stable dollar is the key to developing a program benefiting all the stakeholders.”

G. Thompson of Moker & Thompson Implements in Prince Albert, Sask., adds, “You risk going out of business. In Canada, we have big exchange rate risks. As the value of the Canadian dollar goes up, the value of used machinery goes down. A 5% Canadian dollar swing really hurts.”