The higher used equipment value trend is caused by the economic recovery in the U.S., which has been slow but steady. It has also been caused by users wanting to purchase low-hour used machines that are equipped with Tier 3 engines. In January, many manufacturers started selling Tier 4 Interim machines as mandated by the U.S. EPA. These machines are generally more expensive and there is not a proven track record on whether fuel usage will be the same or more than Tier 3 models. So buyers have been grabbing the Tier 3 machines whenever they come to market.
A lot of the equipment purchased, especially by individuals and small buyers, is an emotional purchase. The buyer selects a machine, model and brand because he’s loyal to the brand, the dealer or the dealer salesperson. I suggest that it will pay off in the long run if you do some homework and a thorough analysis of what’s out there before plunking down those large sums of money for a new machine. ET
Frank Manfredi, president of Manfredi & Associates Inc., has been a consultant to the heavy equipment industry for more than 35 years. During most of this time, he has published a monthly newsletter, Machinery Outlook, which is seen as a critical source of information about the construction, mining, agricultural and material-handling machinery markets.