Optimum hours to change

[Steevo]

Surely the hire/lease firms would have done this calc?

It’s pretty much the most important decision they make.

 

[kill]

Would be interesting to see if goal post have moved as modem kit got more expensive and in theory capable of more hours before major bill ?

I thought you get sorted @Clive with your great buy back terms on Fendts or are Fendt no longer giving deals with very generous buy back terms due to Euro/exchange rates????

 

[Clive]

I thought you get sorted @Clive with your great buy back terms on Fendts or are Fendt no longer giving deals with very generous buy back terms due to Euro/exchange rates????

Not asked recently but I would be surprised if any dealer offered a buy back price today with so much euro uncertainty over the next few years

 

[willy]

Hire prices have not gone up in line with the buying prices, so I do wonder if this may be an option again?

Also our local dealers of all makes seem to be struggling to get mechanics, and so at least with a hire like of frank Rolland will just deliver another tractor if there are major down time likely.

 

[Deereone]

If someone is prepared to pay £x for you old tractor; they must think that it is worth the risk, so why not just run your tractor until it's uneconomical to repair then scrap it?

 

[Lincsman]

Not asked recently but I would be surprised if any dealer offered a buy back price today with so much euro uncertainty over the next few years

I am sure they would, its just you may not like the terms, they need to make a profit, currently the car/van leasors are making a killing on high used values, not sure how the tractor ones are doing, probably OK due to fast rising new prices.

 

[Clive]

I am sure they would, its just you may not like the terms, they need to make a profit, currently the car/van leasors are making a killing on high used values, not sure how the tractor ones are doing, probably OK due to fast rising new prices.

i guess if they were smart enough they could always hedge the currency

off course they need to make a profit and no one should ever be denied the chance to do so.

I would say tractor buybacks / hire deals are doing ok right now mostly due to rising new prices as you say, the buyback available on my last tractors has reflected reality value fairly well so if exercised dealer won't lose out and customers will have had certainty of cost

 

[Kildare]

I think if your doing 1000 hrs or so a year your probably as well trading before the tyres are wore out so the dealer can sell it without replacing them.
Running old stuff and you end up spending a lot of money and time fixing them if your using them a lot.
If your not using tractors much older is the way to go

 

[franklin]

Not asked recently but I would be surprised if any dealer offered a buy back price today with so much euro uncertainty over the next few years

I would expect manufacturers to be into a bit of "you scratch my back" with the more media-savvy farmers. A spot as on of FW's favorites must almost guarantee free use of some gear for a year? Cut out dealer and go straight for the marketing department? I'd dye my ballsack Fendt green for a 718 for a year.

 

[Clive]

I would expect manufacturers to be into a bit of "you scratch my back" with the more media-savvy farmers. A spot as on of FW's favorites must almost guarantee free use of some gear for a year? Cut out dealer and go straight for the marketing department? I'd dye my ballsack Fendt green for a 718 for a year.

well i'm probably the world most least likely farmer to ever grace the pages of FW thats for sure !!

 

[willy]

well i'm probably the world most least likely farmer to ever grace the pages of FW thats for sure !!

Yes but maybe your ball sack...

 

[Poorbuthappy]

A neighbour reckoned to change when the deal was right rather than by number of hours or years run.
Downside I see to this is you have to keep a very close eye on what's available.

 

[warksfarmer]

Is everybody changing tractors or something!

What I can say is I think anybody getting prices for new are in for a shock as the price hikes are shocking. 220hp basic spec of a decent brand can be £55k cheaper than a top spec of a so called premium brand of the same size!

The last new tractor we bought was about £32k on farm back in 1997. We sold it with 2800hrs iirc for £18k. Been hiring ever since bar one blip where we bought a 1100hr 180hp tractor for £58k, ran it to 2500hrs then sold it for £50k because it was going through £1200 spool slices like nobody’s business. Then went back to hiring as we got reminded of repair bills!

When you’ve got so used to hiring tractors/combines and cars it’s very hard to get your head around ownership again due to all the surprises it brings with it. The real question is if for example you were prepared to spend £125,000 on a new tractor are you better off going away from the premium brand and getting 2 nearly new from a cheaper brand?

Edit to add: looking in John Nix and he suggests tractors useful life is 10,000 hours. I would think that is backed up by many years of data.

 

[Spud]

I tend to find hire is similar cost per year to buying, but without the tractor in your ownership at the end. Rarely will repairs cost as much as (say) a 5yo tractor is worth.

 

[Clive]

I tend to find hire is similar cost per year to buying, but without the tractor in your ownership at the end. Rarely will repairs cost as much as (say) a 5yo tractor is worth.

I reckon a 724 is costing me around 16k a year to own based on 5 yrs and 5000 hours - I don't think you can hire one for that little plus I will have a significant residual value at yr 5 were as with hire I would have none ?

if I keep it until 10 yrs 10k hours the gap increases further as cost per year reduces as depreciation becomes less significant BUT does the depreciation simply get replaced by increased R&M cost ? The optimum time to change is before those R&M costs increase but where is that on a modern tractor ? 3k , 5k 10k hours etc ? that's the million $ question

 

[Spud]

I reckon a 724 is costing me around 16k a year to own based on 5 yrs and 5000 hours - I don't think you can hire one for that little plus I will have a significant residual value at yr 5 were as with hire I would have none ?

if I keep it until 10 yrs 10k hours the gap increases further as cost per year reduces as depreciation becomes less significant BUT does the depreciation simply get replaced by increased R&M cost ? The optimum time to change is before those R&M costs increase but where is that on a modern tractor ? 3k , 5k 10k hours etc ? that's the million $ question

Surely a 724 costs more than £80k? A 720 was £114k iirc in 2013 when I priced one!

 

[willy]

I reckon a 724 is costing me around 16k a year to own based on 5 yrs and 5000 hours - I don't think you can hire one for that little plus I will have a significant residual value at yr 5 were as with hire I would have none ?

if I keep it until 10 yrs 10k hours the gap increases further as cost per year reduces as depreciation becomes less significant BUT does the depreciation simply get replaced by increased R&M cost ? The optimum time to change is before those R&M costs increase but where is that on a modern tractor ? 3k , 5k 10k hours etc ? that's the million $ question

I know you have a buy back figure I’m guessing it’s probably 40-50k a new one will be nearer £150k so that’s already gone from 16 to 20k a year without servicing and tyres.
Also as you keep saying and I agree farming is going to alter quick and if you buy you may end up with a tractor that is basically obsolete if robots take over at least with a hire you are not stuck with it.

 

[Clive]

Surely a 724 costs more than £80k? A 720 was £114k iirc in 2013 when I priced one!

where i have said a 724 cost 80k ? last one we bought was 110K and will have a value at 5yrs old - the difference between those numbers = my annual depreciation which plu R&M, insurance and interest cost = my annual cost of circs 16k

do you write your tractors off from new to zero value over 5 years ?

 

[Clive]

I know you have a buy back figure I’m guessing it’s probably 40-50k a new one will be nearer £150k so that’s already gone from 16 to 20k a year without servicing and tyres.
Also as you keep saying and I agree farming is going to alter quick and if you buy you may end up with a tractor that is basically obsolete if robots take over at least with a hire you are not stuck with it.

not had a quote recently but have they really gone up 40k in the last 3 years ? if so I suspect residuals will have been dragged up with them to some extent. Buy back's are a lot higher than 40-50k thankfully ! but actually fairly in line with reality if current used advertised prices are anything like correct

 

[Steevo]

Surely a 724 costs more than £80k? A 720 was £114k iirc in 2013 when I priced one!

5 x 16 = 80k.....plus the residual value at Y5