Waterloo Recalls 275 as Farmers Question Equipment Prices
WATERLOO, Iowa — American farmers celebrated John Deere’s announcement that more than 275 employees will return to its Waterloo operations and more than 400 additional workers will be hired across its factories, before asking the question that has troubled agricultural America for years: will anybody be building a tractor a farmer can afford?
The employment announcement reported by KCRG was welcomed throughout the Midwest, particularly among farmers who have spent recent years repairing machinery older than their children because replacing it would require selling the children.
“I support American manufacturing,” said one Iowa soybean farmer. “I’d support it even more if purchasing American manufacturing didn’t require a financial relationship with three banks and a psychiatrist.”
The farmer currently runs a tractor with enough hours on it to qualify for Social Security. The tractor is still working, which puts it ahead of Congress.
Agricultural Equipment Financing Now Resembles Buying Manhattan
Farmers say the problem isn’t that modern tractors are poorly made. Quite the opposite.
Today’s agricultural equipment offers satellite guidance, sophisticated computers, automated steering and enough electronic sensors to determine whether a farmer has experienced an unauthorized emotion. None of those features guarantees a profitable harvest.
A modern tractor can guide itself across a field with extraordinary precision. It can measure performance, monitor mechanical systems and record operating information. It cannot explain why a farmer is paying for technology that costs more than the crop.
“Granddad needed a wrench and a hammer,” said another grower. “I’ve got a machine that wants a software update before it’ll pull a plow.”
The frustration has reached Washington. The Federal Trade Commission’s lawsuit over Deere’s repair restrictions, covered by the Iowa Capital Dispatch, argued that farmers have been steered toward authorized dealers for repairs they would prefer to make themselves. Deere disputes the claims and points to its repair tools and published manuals.
Agricultural equipment dealers have reportedly considered introducing a more affordable tractor equipped with four wheels, an engine and no subscription to anything. Engineers rejected the proposal as dangerously innovative.
Financing Agreement Fine Print Runs Longer Than the Owner’s Manual
A retired Iowa farmer shared the paperwork from his last equipment purchase. The owner’s manual runs 312 pages. The finance agreement runs 340.
Page 211 of the financing packet contains a paragraph titled “Events of Default,” which includes “any material adverse change in the borrower’s circumstances.” The farmer circled it and wrote “weather” in the margin. On page 288, a clause permits the lender to “re-evaluate the terms of this agreement at its discretion.” Beside it he wrote “so, never.”
“I read the whole thing,” he said. “Took me two winters. The tractor was paid off before I understood how it was financed.”
Repair Receipt Shows $4,100 Bill for a Dashboard Warning Light
A repair invoice supplied by an Iowa grower lists a total of $4,100 for what the line items describe as “diagnostic.” The work consisted of a technician connecting a laptop, waiting nine minutes and disconnecting it. A separate entry charges $186 for “travel to field,” a distance the grower measured at 11 miles.
The final line of the invoice reads, “Warning light cleared.” The grower said the light came back the following morning. He did not receive a second invoice, he said, because he did not call.
Farm Co-Op Poll Finds Producers Want Repairable Equipment Over Touchscreens
A show-of-hands poll taken at a co-op meeting in northeast Iowa asked members what they wanted most in their next tractor. Fifty-one members chose “something I can fix myself.” Nine chose “better cup holders.” Two chose satellite navigation, and one of them said he’d misunderstood the question.
The co-op manager said the results were consistent with what members tell him every week at the counter. “Nobody’s asked for a screen,” he said. “A few have asked for a bigger wrench.”
Farmers Want Something Else Recalled: Their Purchasing Power
According to the USDA Economic Research Service farm income forecast released in September, inflation-adjusted net farm income is projected to decline 5.5 percent from last year, while total agricultural production expenses are expected to rise 4.5 percent.
The numbers confirm a familiar agricultural problem: producing food is expensive, but not producing food is generally considered unacceptable. Farmers buy fuel, seed, fertilizer, insurance and equipment before they know what their crops will earn. The American Farm Bureau Federation has made the same point for years, usually in language less colorful than a farmer standing next to a combine.
Meanwhile, equipment manufacturers need to sell machinery to customers who increasingly regard a new tractor showroom as a place wealthy people visit to experience agriculture.
Still, the hiring announcement is encouraging news for Waterloo workers and their families. Farmers simply hope the additional employees can help build equipment designed for customers who grow corn rather than customers who own oil companies.
One grower offered Deere a straightforward product suggestion.
“Build me a tractor I can fix, afford and pass down to my son.”
Asked whether he wanted satellite navigation, touchscreen controls and automated operating systems, the farmer shook his head.
“No. I already know where the field is.”
Five Humorous Observations
- A tractor older than the guy’s kids, and he’s keeping it because replacing it means selling the kids. That’s the only farm financial plan where the kids see it coming.
- Three hundred and forty pages of financing. That’s not a loan, that’s a Russian novel where everybody ends up owing money to a bank.
- Four thousand bucks to plug in a laptop and wait nine minutes. I’ve had a guy do that at the Apple store. He at least gave me a little sticker.
- Fifty-one guys want to fix it themselves, nine want cup holders. I respect the nine. You’re gonna be out there nine hours. You need a place to put the coffee.
- “I already know where the field is.” Best product review ever written. Twelve words, no touchscreen, and it still beat the whole sales brochure.