Industry Adjusting to Lower Farm Equipment Sales

Cindy Zimmerman

Sales of farm tractors and combines are continuing their downward trend this year and the industry is adjusting after several good years in a row, according to the Association of Equipment Manufacturers (AEM).

aem“The last five years have been pretty darn good years and we were at pretty high levels of equipment sales,” said AEM Senior Vice President and Ag Sector Lead Charlie O’Brien. “So even though we’re down double digits in certain areas, it’s still at not too bad a level, but everybody has to make an adjustment based on what demand is now.”

During the recent Commodity Classic, AEM did an informal survey of ag equipment manufacturers about the downward trend and how long they think it will last. “Everyone has differing opinions but overall people think 2015 will be about the same as last year, 2016 there’s some optimism, but more people are saying 2017,” he said.

O’Brien notes that while sales of large tractors and combines are down significantly, sales of smaller horsepower tractors are up. “The smaller horsepower tractors track very closely with the general economy, while the larger equipment is tied to net farm income,” O’Brien said.

AEM’s most recent numbers on sales of farm tractors and combines show that as of February 2015 sales of 4WD farm tractors are down over 50% from the same time last year, but total tractor sales including the smaller horsepower categories are down only one percent. Combine sales are down 37% year to date.

Learn more in this interview with O’Brien from Commodity Classic. Interview with Charlie O'Brien, AEM

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