The Rural Voice, 1987-04, Page 171
in developing courses for farm
equipment mechanics.
The association is financed by
dues, proceeds from its insurance
programs, and sales by its computer
division. It represents about 95 per
cent of the franchised dealers in On-
tario. Elected president for a one-year
term at the recent convention was
Arnold Kerry of Port Perry, a John
Deere dealer. Past -presidents include
Bill Brown of Stratford, George South
of Meaford, Neil McGavin of Walton,
and Fred Lobb of Clinton. Ray
Gilmore of Harriston was recently
elected second vice-president, and
Martin Olesen of Markdale serves
on the Board of Directors.
Company lines
in
Massey -Ferguson
Case International
John Deere
Ford
Deutz -Allis
others
handled by dealers*
Ontario
18%
17%
14%
14%
12%
25%
*dealers belonging to ORFEDA
A recent ORFEDA victory was
getting a two-year respite from a paid-
up capital tax that Peart estimates cost
individual dealers well over $4,000 a
year — dealers had been paying tax
on the invoice price of all equipment
regardless of sales programs and trans-
fers to other dealers. "Our next job,"
Peart says, "is to work for longer than
two years."
"If the dealers had had that $4,000
per dealership for the last three years,"
he notes, "we'd have had a lot happier
dealers and probably a few more left
than there is today."
A recent change for ORFEDA
was becoming (along with other pro-
vincial groups in Canada) a region of
the National Farm and Power Equip-
ment Dealers (NFPEDA) in the U.S.,
a move which makes the Canadian
Federation of Farm Equipment Dealers
"somewhat dormant," as Peart puts it.
"I guess one of the major benefits is
the fact that now all the corporate
offices are in the U.S. The only
Canadian company left in name is
John Deere Canada Ltd. in Grimsby.
So all the direction is coming from the
U.S. The National has a very strong
policy group in the U.S. that meets
with the majors and they have been
able from time to time to gain some
significant decisions." The NFPEDA
serves some 9,000 retailers of farm,
industrial, and lawn and garden equip-
ment in North America.
And a recent success was the
Canadian International Farm Equip-
ment Show in February, co-sponsored
by ORFEDA and the Canadian Farm
and Industrial Equipment Institute
(Cl,'Ihn.
Normally, as Peart notes, the
C:1-IhI and ORFEDA are on different
sides. The C:FIhI, representing the
manufacturers, was set up in 1966
with a board of 15 members each
serving for three years (the American
equivalent of the CFIEI is about 90
years old). Financed by membership
fees, the CFIEI represents 27 com-
panies (which claim about 95 per cent
of total Canadian sales, a market share
which in 1986 was worth $1.7 billion)
and has 55 associate members (com-
panies or organizations providing a
product or service to manufacturers).
The CFIEI's standing committees
cover such areas as marketing, statis-
tics, traffic and transportation, customs
and excise, legislation, and public
relations.
Brent Harare, general manager of
the C1-IhI, can provide only a rough
calculation of the number of farm
equipment manufacturers in Ontario.
The problem is one of definition, and
small or sideline manufacturers tend
to get lost in the shuffle. Statistics
Canada counted 76 agricultural imple-
ment manufacturers in Ontario in
1984, who together shipped close to
$500 million worth of goods (and 231
in Canada shipping more than $1
billion). At the Ontario Centre for
Farm Machinery and Food Processing
Technology, however, the number of
Ontario manufacturers is estimated to
be 200 — the centre defines an agri-
cultural equipment manufacturer as
any company producing a significant
piece of machinery or equipment that
is found on a farm and is usually
purchased as a stand-alone item.
Brent Harare would say that is over-
ly generous.
Statistics -gathering in the farm
equipment business, in fact, is dif-
ficult, because figures related to sales
and market share are often confidential.
The difficulty, of course, says
Hamre, is that public statistics would
give competitors who don't belong to
the manufacturers' association an
unfair advantage. It's natural, notes
John Kessler at the OFMB, that
companies don't advertise statistics.
"This is a secretive industry," he
remarks, "They're more conservative
than banks with respect to manage-
ment style and information." The
larger picture is easier to estimate,
however. retail sales of farm equip-
ment in Ontario, for example, have
been about $200 million each year
over the past few years — $250
million if repair parts are included,
says Kessler.
Certainly competition throughout
the industry has been fierce as compa-
nies have battled to sell off large inven-
tories, and changes in the industry in
recent years are legion. "In North
America the farm equipment industry
within the last several years has really
gone through quite a metamorphosis,"
says Harare. "For example, there's no
tractor below 100 hp built in North
America at all any longer." Although
the market for tractors between 50 and
100 hp has been "very brisk," says
Kessler, and this size has long been
the most popular, it's simply more
efficient to manufacture smaller
tractors elsewhere.
Tractors on Census Farms, by County,
1981
20.49 hp 50.99 hp 100 hp 4-
2,878 3,050 641
4,236 2,968 325
3,491 3,961 1,173
3,204 3,516 851
Bruce
Grey
Huron
Perth
According to John Kessler's
estimate, the three biggest companies,
Massey -Ferguson, Case International,
and John Deere, will hold 90 per cent
of market share by the 1990s. Com-
pared to these three, which in Canada
manufacture in Brantford, Hamilton,
and Welland respectively, the market
share of the small manufacturers, says
Kessler, is statistically insignificant.
Small manufacturers exist mainly
to serve local needs, to fill require-
ments not served by the mainliners,
Kessler adds. Their declining market
share, says Joe Boyle, general man-
ager of the Ontario Centre for Farm
Machinery and Food Processing
Technology, is partly the result of
a lack of marketing impetus. "They
deal in a limited geographical area, a
county or two or three rather than
APRIL 1987 15