Tariff uncertainty and rising costs weigh on heavy equipment dealers

North America, August 16, 2025

News Summary

A survey of 160 verified North American dealerships finds tariff uncertainty is the top concern for dealers, followed by rising equipment costs and tighter financing. Most dealers report a cautious or worried market outlook, with many expecting buyers to pause purchases, lengthening replacement cycles and slowing inventory turnover. Dealers say excess inventory and high prices are tying up customer capital. In response, many are exploring technology solutions—especially AI-driven pricing and valuation tools, CRM systems and automated lead generation—to protect margins, move inventory and advise customers on extending equipment life.

Tariff uncertainty and rising costs leave heavy equipment dealers on edge; Deere flags profit hit and trims outlook

Heavy equipment dealers entered 2025 with worry at the top of their list as a new dealer survey found tariff uncertainty and rising equipment costs are the leading disruptors for the year. The survey of 160 verified North American dealerships, conducted in April and May, shows a broad pullback in buyer activity and low overall dealer sentiment. At the same time, a major equipment maker reported a tariff-related profit hit and lowered its annual guidance, underscoring the market pressure dealers described.

What the survey found

The survey results place tariff instability as the single biggest economic worry for dealers, cited by 70% of respondents. Close behind, 66.3% of dealers said rising equipment costs are a top concern. Financing difficulties were also common, with 49.1% of dealers pointing to challenges in securing credit or offering attractive finance options to customers.

Dealer sentiment in the survey was largely negative. A majority described their 2025 market outlook as concerned or very concerned. Only 36% of dealers said they felt even cautiously optimistic. Nearly three-quarters of respondents expect economic pressure to lead buyers to pause purchases, which dealers say will likely stretch out equipment replacement cycles and leave machines in customer yards longer than normal.

Inventory and buyer behavior

Dealers reporting the effects of equipment surpluses offered insight into why purchases are slowing. Among those dealers, 38% said customers are delaying purchases because units are too expensive, while 30.1% said excess inventory is tying up customer capital and forcing purchase delays. The combined result is a market where buyers hold onto equipment longer and replacements are delayed.

Technology and dealer responses

Facing these pressures, many dealers are looking to technology to sharpen pricing, sales and lead flow. When asked which tools they want to adopt, 45% selected AI-driven pricing and valuation tools. Customer relationship management systems drew interest from 34.4% of dealers, and 33.7% said they are eyeing automated lead generation tools. These choices point to a mix of short-term sales support and longer-term attempts to manage inventory and customer engagement more efficiently.

Industry context and manufacturer impact

The market signals from dealers line up with actions taken by at least one major manufacturer, which reported a profit impact linked to tariffs and tightened its annual outlook. That move highlights how global trade policy and input costs can quickly translate into tighter margins and more cautious spending across the supply chain.

About the survey and the source

The survey was run by an equipment data and reference firm that serves contractors, manufacturers, dealers, rental companies, lenders, insurers and government agencies in heavy civil construction. The company, owned by a parent firm that was formerly known under another name, has maintained equipment data services for more than six decades and publishes trusted reference guides and rate books used across the sector. The full 2025 dealer insights report is available for free download from the company’s site.

What this means for dealers and buyers

Short term, dealers should plan for slower turnover and look to loan and leasing options that might ease buyer hesitation. Technology investments that improve pricing accuracy and lead conversion may pay off sooner rather than later. Buyers may find more negotiating space on price or terms as dealers work to move inventory, but they should also be aware that certain new equipment supply lines could remain tight or become more expensive if tariffs or input costs stay elevated.

Bottom line

Tariff uncertainty and rising costs loom largest for heavy equipment dealers in 2025. Combined with financing pressure and slower buyer decisions, the result is a cautious market where many dealers expect longer equipment life cycles and delayed purchases. Interest in AI pricing tools and CRM systems shows dealers are looking for practical ways to manage the challenges ahead.

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FAQ

Key features at a glance

Feature	Detail
Sample	160 verified North American dealerships (April–May 2025)
Top concern	Tariff uncertainty (70% of dealers)
Other major concerns	Rising equipment costs (66.3%); Financing challenges (49.1%)
Dealer outlook	Majority concerned or very concerned; 36% cautiously optimistic
Buyer behavior	Nearly 75% expect buyer pauses; longer equipment life spans projected
Tech interest	AI pricing/valuation (45%); CRM (34.4%); Automated lead gen (33.7%)
Industry note	Major equipment maker reported a tariff-driven profit hit and tightened annual outlook
Report access	Full 2025 dealer insights report available for free download

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Additional Resources

• Reuters: Deere quarterly profit falls as US tariffs hit farm equipment margins
• Wikipedia: John Deere
• Equipment Finance News: Equipment dealers face mounting tariff concerns
• Google Search: equipment dealers tariffs 2025
• Colorado Politics: U.S. producer prices surge in July as tariffs push costs higher
• Google Scholar: producer prices tariffs 2025
• Tom’s Hardware: EU fab tool makers get reprieve in EU–U.S. tariffs deal
• Encyclopedia Britannica: semiconductor equipment tariffs
• The Cattle Site: US–China extend tariff truce
• Google News: US China tariff truce 2025