Shuttered assembly businesses and mandated social distancing have reduced manufacturing capacity in the northern hemisphere in past months, with many large brands forced to close their operations at times throughout Europe and the United Kingdom.
But Tractor and Machinery Association (TAMA) president Kyle Baxter says it was air freight capacity to New Zealand, rather than a lack of parts that was proving the greatest challenge for machinery stockists.
“Overall, the availability of parts is pretty good, but the reduction in air freight capacity and the cost of that capacity are an issue,” he said.
“This comes after we have usually enjoyed really good service through the likes of Fedex and DHL out of Europe.”
Typically, delivery times for parts out of the United States or Europe could be as short as 36 hours, if an order was placed on Friday NZ time.
“And out of Australia, it would be pretty much overnight,” he said.
The time taken now can be well over two weeks, depending upon the capacity flights are offering. Even then cargo can get bumped for higher priority loads just before departure.
Prior to covid-19, some machinery importers had enjoyed dedicated capacity on regular freight flights during the week, regardless of order size, but have since lost that.
Baxter says many TAMA members had stocked up well on parts heading into spring, often relying upon slower sea freight for delivery.
Former TAMA president and owner of Masterston-based Tulloch Farm Machines John Tulloch says initially air freight rates into NZ tripled, but had since come back to one-point-five to twice pre-covid rates.
“It is tight, but we are getting everything we need from overseas, but just a bit delayed, he said.
“Parts from French-based plants seem to have considerable delays, while Germany is varied depending upon what area of the country the plant is in.
“Some companies like Krone had two teams operating; a team A and team B kept separate and assembling equipment to keep them isolated and keep plants running.”
When it came to sourcing new equipment, Baxter says most machinery importers already had orders in place before lockdown for delivery this season, although there had been delays of several weeks earlier due to plant shutdowns.
“There have been a few delays now, but to everyone’s benefit they have been at the bottom end of the scale,” he said.
“All members we have spoken to have not been too impacted.”
He was confident that if worse came to worst, service staff would do all they could to keep equipment running, even if it meant borrowing a new part from a new machine.
Getting new equipment for later in the year should not be too problematic either.
CB Norwood, where Baxter was brand manager, was already taking orders for cultivation equipment and he was confident it would arrive in time by February.
Viticulture and horticulture sectors were doing particularly well, and many were investing in new equipment, which was often sourced out of Europe.
“We knew the market was heading for a correction in sales earlier this year but we have not been too far off the mark. July this year was on a par with July last year,” he said.
Tulloch says the staff shortage for operating equipment this spring-summer may yet have a bigger impact upon contractors’ decisions about purchasing capital equipment.
“If they do not have the people to operate it, they will not invest in it,” he said.
He had noticed more farmers investing in second-hand equipment they would normally have a contractor use, possibly as insurance against contractors being unable to make timely harvest themselves.
“The market has been quite buoyant considering how things are,” he said.
Farm bikes and equipment are proving relatively easier to source coming out of Japan rather than Europe, although some delays in air freight are being experienced here too.
A spokesperson for Ashburton-based MacKay and Donaldson Yamaha says parts coming out of Japan were being rerouted via Australia, but priority was given if the factory was told it was a farm bike the part was required for.
A spokesperson for Matamata Honda confirmed 95% of parts and stock were available, with about a three-week delay in sourcing them from Japan.
In Canterbury, Gavin Briggs of Rainer Irrigation says reliance upon sea freight delivery meant most suppliers stocked up well with parts, but some smaller components were starting to become problematic for supply.
Furloughing of staff in some United States and Chinese production plants had meant output and component production had been wound back as those companies trod water, assessing covid’s impact on global demand.
“We fill a container up when we order and carry about $2 million worth of parts at any time, but I suspect we are going to see some issues later in the season,” Briggs said.
He said he would be grateful if he can make it to Christmas without any major supply issues once the season starts in about two weeks.
