Ag OEMs, dealers mull strategies to drive industry recovery

Agriculture equipment dealers and OEMs are hopeful that incentive programs, tax breaks and value-added services will help them build momentum going into 2026. 

Despite farmer sentiment reaching a four-year high in May, the farm equipment sector continues to grapple with a prolonged sales slump caused by low income, high interest rates, tariff uncertainty and rising new equipment prices. Highlighting this trend, U.S. tractor sales and self-prop combine sales decreased 15.1% year over year and 56.5% YoY in the first quarter, respectively, according to the Association of Equipment Manufacturers.  

These challenges are expected to continue throughout the year, but there’s hope that the industry will turn the corner in 2026, Marc Johnson, principal and equipment distribution expert at Pinion Global, an agriculture consulting firm, said during Ag Equipment Intelligence’s June 5 executive briefing webinar.  

Tax breaks, OEM incentives key 

One potential boost for the market are the tax breaks in the Trump administration’s “One, Big Beautiful Bill,” which was passed by the House of Representatives last month and is being considered by the Senate, he said. 

The bill includes full bonus depreciation, allowing taxpayers to immediately expense 100% of the cost of equipment acquired on or after Jan. 20, 2025, and before Jan. 1, 2030.  

Agriculture OEMs can help drive the industry’s recovery by getting “creative” with their dealer partners to offload equipment, Craig Harthoorn, president of equipment manufacturer Oxbo’s forage division, said during the webinar. 

“So, we’ve been talking to dealers about lease options, low-rate financing, demo programs, whatever we need to do,” he said. “We need to go out there and spend time on that [dealer’s] yard to help him move some of that equipment so we can get that pipeline freed up and hopefully see things take off here toward the latter part of this year.” 

Dealers lean into tech 

As many farmers hold off on purchasing equipment amid economic challenges, dealers must find other ways to generate revenue. Focusing on selling precision agriculture technology is one potential avenue for dealers, Steve Hunt, president at Hopkinsville, Ky.-based H&R Agri-Power, said during the webinar. 

Precision technologies include GPS systems, drones, autonomous systems and data collection software. They not only provide an additional revenue stream for dealers, they can enhance farmers’ efficiency and improve net margins, thus benefiting the industry overall, Hunt said. 

“Despite overall market softness, we’re focused on value-added precision selling,” he said. “We’re trying to drive business somewhere where they’ll buy something. So, aiming to improve operating margins and driving [tech] adoption among more customers, that’s going to, in turn, help their operations become more efficient and profitable. So, we’ve had some success driving that through.”