In this video, we break down the final 2024 tractor and combine sales report from the Association of Equipment Manufacturers (AEM), highlighting five key takeaways from the latest data. These insights reveal trends that will impact anyone shopping for equipment. Here are the takeaway's:
1. Sales Across All Sizes of Tractors and Combines Dropped to the Lowest in 5 Years
The AEM sales report shows a decline in the sales of every single tractor horsepower size and all combines in 2024. It's been a while since every segment of the tractor and combine market was down, and combining all classes of tractors and combines, it was the lowest cumulative level of sales in the past five years.
2. Compact Tractor Sales Plummet – 14% Drop from 2024 and 18% from 2019
Compact tractors saw a major sales decline in 2024, with a 14% drop from the previous year, and a nearly 18% drop from 2019, the last pre-COVID year. The pandemic fueled a surge in compact tractor demand, driven by stimulus packages and the popularity of hobby farming. However, post-pandemic, the cooling demand, along with higher interest rates and inflation, has led to this sharp downturn.
3. Mid-Range Tractor Sales Decline, But Not as Drastic
Mid-range tractors (40-100 horsepower) didn’t see the sharp declines that compact tractors did, but they still experienced a nearly 10% drop in 2024. This suggests that while smaller tractors are slowing down, mid-range and larger models are also facing challenges. These tractors are often essential for livestock operations, so this decline could indicate tightening budgets or growing uncertainty in the market.
4. Farm Economy Struggles Impacting Large Equipment Sales
The report reveals a significant drop in the sales of large equipment, including tractors over 100 horsepower, articulated four-wheel-drive tractors, and combines. Combine sales, in particular, plummeted by 24.3% compared to 2023. Several factors are at play here, including volatile crop prices, unpredictable weather, and rising operational costs. Many farmers are delaying large equipment purchases as they focus on managing cash flow amidst economic uncertainty.
5. Rising Inventory, but Manufacturers Keep Production in Check
While inventory levels have increased, manufacturers have been somewhat effective at curtailing production to avoid oversupply. This helps prevent a "fire sale" scenario and keeps pricing stable, even as demand slows. For buyers, especially those looking for smaller tractors, this means they now have more negotiating power than in 2020 and 2021. However, it’s not yet totally a "buyer’s market," as manufacturers remain cautious about flooding the market with excess stock. Dealers have more flexibility on price and financing but are still cautious about drastic price cuts.
What Does This Mean for the Future of Agricultural Equipment?
The 2024 AEM sales report paints a clear picture of an agricultural equipment market that’s cooling down after the pandemic surge. Sales are down across the board, particularly in compact and large equipment categories. With the farm economy facing challenges like inflation, rising interest rates, and uncertain crop prices, it’s likely that demand for agricultural machinery will remain subdued in 2025. Farmers and equipment buyers will need to proceed cautiously, prioritizing essential upgrades and replacements.
Manufacturers and dealers will have to adapt to these market shifts, keeping an eye on consumer behavior and economic conditions to remain competitive. Tractor buyers may find more negotiating power in the current market but should still be mindful of long-term financial stability when making equipment purchases.
If you found this analysis helpful, don’t forget to like, comment, and subscribe for more insights into the agricultural machinery industry! Thanks for watching, and we’ll see you in the next video.
00:00 Introduction
00:28 All Classes Were Down
01:06 Substantial Drop in Compact Tractors
02:53 Mid Range Down...But What Sizes?
04:24 Farm Economy Hitting Big Tractors/Combines
07:06 Inventory and Negotiating Power
LINKS YOU NEED TO KNOW ABOUT...
Tractor Mike Website/Fun Store: https://asktractormike.com/products-for-sale/
Support the Tractor Mike Channel: https://www.patreon.com/TractorMike
Amazon Affiliate Page: https://www.amazon.com/shop/tractormike
Contact us at: [email protected]
Copyright 2025 Tractor Mike LLC