Local Farm Equipment Auction VS Regional or National Auctions.
1. Local Farm Equipment Auctions
Tends to work better for the buyer (lower prices), due to drawing a more limited number of potential buyers. Local auctions tend to be estate, or retirement farm liquidation.
2. National Farm Equipment Auctions
Tends to work better for the seller (higher prices), due to online exposure, or even online bidding. You have a much larger selection to choose from. You could be bidding against several hundred others for the tractor you want. National auctions, by majority tends to be the equipment received as a trade in during new purchases, or more specifically the older trade in equipment that they did not keep on their lot, However sometimes dealers will place their late model trade ins in an auction with a set reserve.
National Auctions usually come with hidden fees, such as a buyer’s premium of 10%, internet platform fee, and don’t forget about transportation.
The rising price of used farm equipment explained.
To put it simply, during COVID, a bottleneck in the supply chain was created. Lack or workers, steel, and computer chips contributed to manufacturing delays. Creating a higher demand for the remaining limited supply, driving up tractor prices. The same can be said for used equipment. Many farmers chose to repair instead of purchasing new, creating a shortage of used tractors in the market. This drove up used tractor price by 25%, with interest rates also increasing creating what we now call the new normal.
Tractor Auctions VS Dealership Purchases.
1. Price
Auctions typically offer lower prices (typically 15% to 30%) lower than the same used model would through a dealership. With new equipment being even higher, with some brands you pay extra for their name.
2. Condition
Equipment purchased through an auction is sold as is, and with no warranty. The same used models at a dealership have been inspected by mechanics with some idea of their working condition. New equipment having no working time on the machine and having a warranty.
3. Inventory
Local auctions offer small inventory options, or a single tractor such as an estate auction. Larger auctions offering a wide selection including several brands to choose from. With dealerships having access to their full lineup of tractors, even custom orders.
4. Parts availability
One should do a little research on parts availability for the specific tractor they plan on bidding on. Some brand name tractors less than a decade old are already experiencing a shortage in parts, due to replacing a model, or parting ways with the parts manufacturer. Do your research.