Farm Ireland

Monday 23 October 2017

Brexit delivers £2m boost for Deere dealer

Lisburn-based John Deere dealer Randal McConnell
Lisburn-based John Deere dealer Randal McConnell

Chris McCullough

A County Down tractor dealership is enjoying a major boost in trade and has increased its customer base thanks to the British electorate's decision to vote for Brexit.

Based on the Lisnoe Road just outside Lisburn, Johnston Gilpin & Co Ltd has been selling agricultural machinery since 1968 and is now Northern Ireland's largest John Deere dealership.

Prior to Brexit the dealership had built up a large stock of used tractors and machinery as it had traded these in against sales of new vehicles.

That portfolio had built up to over £2m in value and was tying up capital for the business meaning it was more difficult to invest in new stock.

Managing Director Randal McConnell says Brexit has been extremely good for business.

"When the Brexit vote was announced the pound euro currency exchange started to become more favourable for tractor buyers in the Republic of Ireland and other countries that used the euro.

"In the past few months we have cleared out over £2m worth of used stock that was tying up our capital.

"In the past year sales of new tractors and new self-propelled forage harvesters has been excellent, but on the back of that we had traded in quite a number of used machines.

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"Of course these were selling, but since the currency slide thanks to Brexit we have sold a large number of used tractors to customers in the Republic of Ireland and even into Spain.

"Brexit has meant our business has increased its used tractor sales and we have added more customers to our database.

"I am not saying these customers will all return for more business but we certainly are expanding our reach," says Mr McConnell.

As the years have passed tractors have become bigger and as a consequence their prices have also increased.

Therefore the average price of the used stock sitting in Randal's yard was higher than in the past but the favourable currency exchange for euro based countries made them more attractive.

However, Brexit has pushed up the prices of new tractors and other large machinery by around six per cent, again due to the pound sterling exchange rate.

"We have more capital now to invest in new machinery thanks to the sales of the used tractors," added Mr McConnell.

"However, we are buying the majority of these tractors direct from the manufacturers in Germany and prices of the new equipment have increased by six per cent."

A new John Deere 6195R tractor which is equipped with a totally automated operator system retails today at around £125,000.

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