Given these enormous price tags, why on earth hasn't someone disrupted this industry?
Surely someone can build a useful, powerful tractor that meets the needs of a large portion of farmers for less than a third of a million dollars. And if they make it repairable and not DRM-encoded (like John Deere) surely that would build a loyal brand following too.
Bezos has that famous line: "Your margin is my opportunity". Well shoot, there really does look to be a margin in that industry.
Because the other large players are so large that they will either buy you out or legally stamp you out of existence before you can gain significant market share. And farmers aren't going to be easy to convince to drop $100K+ on a tractor company with no history, no reliability metrics, and no guarantee the company will even exist in 20 years when something major breaks requiring more expensive custom manufacturing. It would take 100 million or more dollars in capital to even start a new heavy equipment company before you even start dealing with all the legal costs and requirements of staying in the market with the other big players.
In developing nations people like you know to keep their mouth shut while in the developed world people like you are coddled until they actually believe their insipid comments are worth reading.
MTZ [0] of Belarus is probably the most repairable tractor brand. It's better quality than it used to be. Exported all over, and supposedly gaining a foothold in the US too...
Because it’s competition to multi billion dollar existing companies.
John Deere has the ability to buy every new ‘disruption’ and lock it up in a vault..never to see the light of day again. Why would they disrupt anything? That would be akin to market cannibalisation.
The opportunity cost here is pretty high, but there are still ways to break in.
Your best bet would be to start up a small company, find a few farming operations that would be willing to try your equipment out, and then scale from there. Making 1 prototype of each flavor of machine from scratch would probably be a huge undertaking. Might be easier to use existing equipment as a starting point for prototypes. Alternatively, you could pitch a design to a few investors and go from there, but investors being what they are... It's a hard journey either way.
Also, no one says you have to turn around and sell your assets to John Deere when they inevitably detect you as a threat. The power of privately-held corporations is that you can do whatever the hell you want within the confines of law. I would strongly advocate whoever pulls this off to stay in the market and punish the shit out of the incumbents.
JD bought out Blue River Tech for a two hundred plus million. They shuttered their lettuce weeding robots and use it for cotton now...the last I heard.
I get it. But I don’t know why they had control the platform for specific crops.
My guess is that since BRT tech is ‘see and spray’, there will be a tie up with precision herbicide application with Bayer(née Monsanto) products.
Remember..afterall..John Deere wanted to buy Climate and Monsanto before DoJ blocked it with anti trust objections.
Buying out your competitors is not a sustainable replacement for innovation. If you don't cannibalize your own products, others will. Look no further than Kodak for an example.
There are lots of large agricultural equipment companies engaged in real competition and John Deere doesn't have unlimited resources to buy up competition.
You look at a company like SeedMaster that is in direct competition with JD in a lot of areas and using profits to fund some genuinely new ideas.. they are still here!
Because if you can start a disruptive company, and the shareholders believe your claims about how disruptive it'll be, the valuation of your company will be more than John Deere can afford to buy from their own valuation based in the profits on their margins...
Surely someone can build a useful, powerful tractor that meets the needs of a large portion of farmers for less than a third of a million dollars. And if they make it repairable and not DRM-encoded (like John Deere) surely that would build a loyal brand following too.
Bezos has that famous line: "Your margin is my opportunity". Well shoot, there really does look to be a margin in that industry.