Tier III machines expected to hit USA Resale Market in 2018
It’s been several years since we’ve seen Tier III & older legacy machines on the US Resale Market in a big way, I see that changing in 2018. Contrary to what many believe, the US Export Market is not dead, it simply took an extended break due to supply issues, not a decrease in demand. Historical buyers found machines to import from other regions (mainly Tier II & III units from Asia) in lieu of their traditional US-based sources.
Tier III units in the US market produced/delivered between 2008 – 2012 will represent the bulk of this export opportunity. In my view the upcoming market will offer a large volume of this iron (trades, fleet buys, etc) beginning in Q1 2018 and extending a few years as significant inventories tap-out: it is a finite resource. Most “post-recession end-users” who held Tier III machines in lieu of purchasing Tier IV-interim machines in the 2011-2014 time-frame will move forward and out of those aged, higher-hour units as confidence in the United States Economy propels new machine sales.
For makes/models with historical overseas market acceptance, “pre-Tier IV machines” will again flow into the Latin American region and other parts of the world. Having a relationship with an experienced, bilingual/fluent and seamless connection to those customers will be crucial in capitalizing on this opportunity. Social Media & more contemporary Marketing Solutions will commonly be used alongside classic Email Marketing Campaigns. Overall 2018 should be a good year for US Machinery Exports and the annual milestone February Auctions in Orlando are just around the corner as a measure, stay tuned…Prospero Año Nuevo!
Exported: Volvo L350F arrives in Brazil
This Volvo L350F spent it’s “first life” in a Bio-Fuel operation in the Deep South, one of three (3) equipped with Wicker Logging Grapples: all over 16,000 hours. We took them in-trade, sold the first to another USA-based Dealer and the remaining two (2) units to this Brazilian customer who owns several quarries, produces huge granite slabs, polishes, preps and containerizes for export worldwide – one source for your fine granite countertops!
Volvo EC340DL De Tiering
Turks & Caicos (Summer 2016) – It’s brutally hot most summer days and sometimes unbearably humid in the Islands of the Caribbean, but the perpetual challenge for builders/developers is lack of dealer support on this outlying archipelago. While the dealer in the Dominican Republic was the “dealer of record” for this Island Nation, they have no brick and mortar operations there, and no Service Techs with VISA’s to enter the Country: we stepped in and filled the void.
Our customer needed to acquire a late-model machine to fulfill their dire need of a 30+ Metric-Ton excavator – we provided this Volvo EC340DL (Tie IV-interim) and the support required to ensure it would function as intended, thus our first “de-tiering” project was slated and planned.
The mechanical work was fairly simple, approximately five (5) hours by an experienced Service Technician: partial removal of original ex-factory emissions equipment, install of replacement parts, documenting the process, etc.
The process was only complicated by some on-site broadband and cell coverage issues, which were expertly managed and overcome by our team. Reprogramming of the ECU was then an easy final task.
One year on this “de-tiered” hydraulic excavator is working as intended and meeting the needs of our customer with no reported incidents…who’s next?
USA Lease Returns – Tier IV-interim
A rare buying opportunity is currently available with Lease Returns in the USA. In the past few years many contractors have elected to take advantage of the attractive leasing options offered by manufacturers and dealers all over the Country. As leases reach their end large volumes of machinery are coming available each month in the USA.
Inherently these lease return machines are Tier IV-interim and prices are depressed across all makes and models, presenting overseas buyers with an excellent opportunity to “De-Tier” these machines and the glut in the USA market. In my opinion the best-case scenario is exportation of such units to overseas markets needing good quality machinery at reduced pricing.
It is clear some customers are taking advantage as we have seen examples of contractors from Mexico, Central and South America obtaining machines through various sources, “de-tiering” and putting them to use alongside other machines acquired through dealer channels.
We are interested in hearing about your experience, that of fellow contractors in your Country and interest in this relatively easy process. Let’s begin the discussion!
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