OEM incentives drive buyers from used construction equipment to new machines

Used Construction Machines Are Vanishing From Dealer Lots as New-Equipment Deals Bite

Summary

Used construction equipment is gradually disappearing from dealer lots as manufacturers push aggressive deals on new machines. A recent industry survey of 150 dealer locations shows continued demand for used gear, but strong incentives for new machines are changing what buyers choose and how dealers manage inventory.

Key survey findings up front

The heavy-equipment research firm conducted a dealer survey covering 150 locations. Eighty percent of dealers met their used-inventory targets in the second quarter, and ninety percent reported that demand for used equipment was steady or improving during that same period. Stable used prices and steady demand helped those results, and dealers also benefited from large commercial projects and solid homebuilding in some regions.

Why used machines are under pressure

Manufacturers are offering a range of incentives that are making new machines financially more attractive. The three most common incentives are interest rate buydowns, extended warranties, and technology upgrades. Interest rate buydowns are the most widely used tactic and are a major reason some buyers skip used units. Promotional financing can bring the monthly payment on a new machine close to that of a used machine financed at higher interest, which reduces the price gap that usually favors used equipment.

Dealer reactions and shifting strategies

Sales teams are more likely to push new machines when the price-per-month is comparable and attractive programs are available. That dynamic has led dealers to purge certain late-model used units—especially older late-models that sit just below the price point of a new machine. Many dealers who once kept one- to two-year-old, low-hour equipment on the floor are rethinking that mix.

One common dealer tactic is to move late-model used machines into rental fleets. Dealers may rent a machine for six to twelve months, add hours while generating rental income, and then sell the asset later as a higher-hour used machine. That helps preserve margins and avoid direct competition with new-equipment incentives.

Outlook for the next quarter

The report shows mixed expectations for the third quarter. Forty percent of dealers expect used inventory levels to increase, while another forty percent expect levels to remain the same. Part of the planned increase comes from dealers looking to stock up on used machines later in the year to take advantage of tax moves such as 100% bonus depreciation and other year-end tax breaks.

Market forces helping dealers

Despite pressure from new-equipment programs, several factors helped dealers in the recent quarter. Used-equipment prices were generally stable, and dealers showed resilience to tariff uncertainty. Ongoing large commercial developments and steady homebuilding in parts of the country also supported equipment demand.

What this means for buyers and sellers

Buyers weighing used versus new should compare monthly payment scenarios as closely as total price, since promotional financing can make new machines more affordable month-to-month. Sellers and dealers should expect more competition between new and late-model used equipment and may shift inventory strategies toward rentals, targeted purges of specific model years, or holding units for tax-driven resale windows.

Context from the original web content

The survey was accompanied on the original site by standard page elements such as subscription form fields for email and name, newsletter options, and a cookie consent prompt. The page contained a footer copyright notice listing 2025 and an image tag reference for site branding. These items do not affect the survey results but were part of the original posting.