Welcome to our first “Remarketing” themed edition. After nearly a year of to-the-shoulders immersion in used equipment (perhaps nostril-level for conference lead Kim Schmidt), we’re proud to see the Dealership Minds Summit, and this issue, come together. Our two national conferences in Omaha in August showed our audiences’ energy, a “let’s get after it” attitude and a sincere willingness to share what they know. Thanks to all who participated in this sold-out gathering.
In the margins of the schedules in Omaha, there were cloud-pushing conversations too, including a few that played out long after the mics were turned off. A couple of these “what-if” questions already are consuming my sleepless nights.
So as the industry tries to turn the corner on the glut of used inventory, here’s something that could further rock your world ... What happens to dealers should the day come when the tractor is replaced by autonomous (or semiautonomous) powered implements? Will the dealer model participate as we know it, or merely be saddled with the “old” displaced units?
An interview at the Farm Progress Show dove into the technological leaps in self-powered implements. Norbert Beaujot, founder of SeedMaster, debuted his diesel-powered autonomous platform this summer from his new sister company, DOT. You can see the technology in action on www.farm-equipment.com/DOT. He repeated how inefficient the tractor is today, and even used the word obsolete.
After a question on how far away such technology is from reality, Beaujot bristled. He maintains it can perform right now (he’s demonstrated it with 4 applications to date), and the obstacle-avoiding software is underway and coming to ag courtesy of the auto industry — more reliable and cheaper, too.
This reminded me of similar conversations that followed Kraig Schulz’s (Autonomous Tractor Corp.) keynote on semi-autonomous farming at last winter’s Precision Farming Dealer Summit (see www.farm-equipment.com/Schulz).
So what’s next? The technology element is pretty much solved, Beaujot says. As for acceptance, well, he reminds us how farmers once tried to dismiss the newfangled tractor because it wouldn’t fit their horse-drawn plows. Schulz points to the continuously rising farm production costs over the past 25 years. The price and repair of equipment doubled from 1975-2012 and fuel efficiency (which has improved only 17% in 6 decades) are making the case for semi-autonomous machines, he says.
But success today requires more than a better working mousetrap. When the “tractor engine” first came on the scene, manufacturers didn’t need to concern themselves with the “industry” they were displacing. There was no “draft horse lobby” or alternative technology that threatened to keep it on the sideline as 15 million farm horses were displaced by 1945.
Now, consider the OEMs’ investment to protect in their cash cow — the tractor. Surely their hordes of engineers, if they chose to, could pursue the innovative work that Schulz, Beaujot, Farb Guidance and others are now pursuing. Yet it’s been relatively quiet from the majors, unless you want to include the farm show versions of the “concept cars” one tends to see at the Detroit Auto Show.
Why? Because the majors’ investment in manufacturing plants, technology and parts.
There are many inventions that fail because the threatened segment responds in a way to not yield its ground. For example, analyst and Summit speaker Ann Duignan, while noting how ag benefited from the ethanol mandate, also shared how the deep-pocketed American Petroleum Institute is attempting to change that picture.
All of this impacts you beyond the prospect of having to find new homes for displaced equipment. Assuming the next-generation equipment would move through traditional retail, tomorrow’s machines could be built with such little maintenance that dealers could go hungry on parts and service.
The term “revolutionary” is used because these developments require a battle, and there’ll be winners and losers.