The heady days of 2022 when order books were full and waiting times were extended, are rapidly fading into the past as industry confidence drops in Europe and overall tractor sales fall in both Ireland and North America.
CEMA the umbrella organisation for European trade associations has reported a rather depressing outlook growing within its membership, while the Association of Equipment manufacturers (AEM) has noticed a sharp decline in sales of smaller tractors although larger units, above 100hp, are still in demand.
Tractor registrations in Ireland
Meanwhile, in Ireland tractor registrations are also showing a sharp decline compared to September last year, although sales, to date, are still up on the same nine months of 2022.
Sales for year to end of Sept
It would appear that dealers do not have too much to complain about and few, if any, are.
This year there have been 2,033 tractors registered so far which is 45 more than the five-year average, and it is second only to 2021 out of those five years.
From that perspective there is little for dealers to complain about and few are, but there is also a sense of change in the air as the quiet confidence of 12-months-ago has given way to the almost universal sentiment that 2024 is going to be ‘interesting’.
Glum clouds over Industry
This aura of uncertainty is reinforced by the latest report from CEMA which notes:
“The general business climate index for the agricultural machinery industry in Europe remains in negative territory showing little change compared to September after the sharp declines of the previous months.
“In October, the index decreased from -31 point to -32 points (on a scale of -100 to +100),” CEMA added.
The index is based on a monthly questionnaire sent to what are described as 140 senior managers in the agricultural machinery business, and a summary of their responses does not bode well for the immediate future.
A sizeable 42% of the respondents classed their present situation as unfavourable or very unfavourable, while 57% expected their turnover to decrease, a figure which has hardly changed from September, but is 11% up from August.
It must be noted that these are subjective rather than hard-nosed actual figures, but there is no doubting the change in sentiment that hit the industry as the holidays ended.
Big tractors boom in America
Over in the US there is a similar air of resignation to fate as sales of all tractors have declined by 8.2%, year to date, over the same period as last year.
This fall was led by the continuing drop in sales of sub 40hp tractors which fell by 11.2%.
However, there was some good news for the industry as sales of tractors of 100hp or more were up 7.6% from last September, while those of 4WD tractors rose by a whopping 114% compared with the same month last year.
This sudden interest in large 4WD tractors appears to stem from the realisation that large tracked machines have inherent advantages over 2WD machines or tyre shod articulated units.