The last time Farm Equipment spoke to Ulrich Beckschulte, director of Germany’s dealer association in Essen (H.A.G.) at Agritechnica, it was in late 2007. The ag equipment market in Europe had improved significantly up to that point and dealerships stood to benefit.

Two years later, it’s clear the global recession, tight credit, low commodity prices and poor demand for both new and used equipment in much of Europe has eroded the optimism of farmers and dealers alike.

German equipment dealers also continue to face common challenges with their North American counterparts, including purity demands by the majors and finding qualified service technicians. But Beckschulte shared some developments that show promise for the future.

Relations with Manufacturers. “It’s harder and harder,” Beckschulte says. “The Beckschulte manufacturers are not all the same in what they want from the dealers. Some are on a very high horse in Germany, some are not. Some of the manufacturers want the dealers to help the brand, and some don’t want the dealers’ help at all, and they do everything on their own.”

Beckschulte says dealer and brand associations formed in Germany are trying to improve communication with manufacturers in areas such as dealer contracts or market challenges. He’s seeing mixed results. “We want a win-win situation. We say we can do a lot of things better together,” he says. “Maybe we know our dealers are experts in spare parts or second-hand machinery and they know things about a brand that manufacturers do not.

“It is very interesting to follow a discussion about spare parts between experts from the dealers and experts from the manufacturers. They never knew about each other. The most important aim is communication on an equal level.”

Dealer Purity. “That is growing,” he says, mentioning Claas and John Deere by name. “Some manufacturers say if you don’t sell our tractors you can’t get my harvesting machines. Others say if you don’t sell my harvesting machines, you can’t get my tractors. It’s on a legal basis and dealers don’t love it, but it’s a normal market situation.”

In Germany’s tiered dealer system, there are about 800 “A” dealers that have a major tractor line, with thousands of “B” dealers that have contracts with “A” dealers for mainline equipment. More and more, Beckschulte says, “A” dealers are being held accountable if the “B” dealers don’t follow through on purity demands. Otherwise, “You’ll get less money from the manufacturer, less points, less spare parts conditions, whatever,” he says.

German dealerships are searching for a remedy. “We sometimes ask manufacturers, ‘What do you want? Partners in the market and fans of your brand? Or do you want franchise systems?’ ” Beckschulte says. “And we always get the answer that they want partners, so we don’t understand what they’re doing. We’re not sure if we should believe them or not.”

Surveys Abound. In Germany and other European countries, satisfaction surveys are now being widely distributed to dealers, asking how satisfied they are with their brands — whether it’s a manufacturers’ warranty claims processing, parts support, marketing initiatives or other areas.

This year, for the first time, industry leaders could simultaneously compare survey results from many different countries. There aren’t many differences between European countries on most questions, but some major differences among the brands, Beckschulte says. On a positive note, “We saw from last year, 2008 to 2009, that nearly every brand got better in terms of the satisfaction index. And two of them really made a step forward — John Deere and New Holland.”

The anonymous surveys have ruffled some feathers with the manufacturers, Beckschulte admits. “But they’re absolutely necessary. We’re not against the brand, we just want to be more together. Even if they don’t want to hear us, we’re still saying that something could be a problem. We also see manufacturers reacting. They’ll say, ‘OK, let’s talk about marketing. What can we do better?’ ”

Equipment Sales. “Until July this year, the dealers were very satisfied with the economic situation. Turnover was OK. Since August or September, turnover really decreased 10% or more – sometimes 100%. We all have been waiting for this exhibition. After Agritechnica, you have usually a push to the dealerships. We hope to have that again, and if not, we have a large, large problem.”

The picture for used-equipment sales, which had some promise for German dealers in 2007, is very poor right now. Beckschulte says the next year will likely be difficult for farmers and dealers alike. “In the eastern part of Europe, the situation is very bad. The farmers don’t have any money, and for second-hand equipment, if it breaks down, we all have a problem.”

Recruiting Technicians. Two years ago, Beckschulte lamented the problems German equipment dealerships were having in finding good service technicians. The image of shops full of noise, oil and dust is a big problem, and many students would rather chase their dream of being a doctor, lawyer or dentist. “There’s not enough technicians, they’re not good enough, not qualified enough, whatever,” Beckschulte says of the potential field.

A possible answer to this dilemma was the creation of the “Starke Typen” (“strong characters” in German) program by H.A.G. and a host of manufacturers and other interests. The recruitment and training program for heavy equipment mechanics is meant to increased the number of highly qualified technicians for the German labor market and improve the image of equipment service.

Starke Typen organizers have also posted videos on YouTube “to get the message out that agricultural equipment is sexy, is powerful and has a strong future,” Beckschulte says. “That’s the story we want to tell. It’s not only tractors, it’s not only Claas, it’s not only oil or dust, it’s a very interesting career.”

The scene at Workshop LIVE at Agritechnica.

Agritechnica also hosted “Workshop LIVE” — where graduates of the Starke Typen program worked on tractors and combines in front of the trade show’s audience. With cameras and microphones in tow, moderators took questions from teachers and parents and interviewed the graduates about their career choice.

A satisfying moment for Beckschulte was a ceremony at Agritechnica to honor the 10 best-service dealerships in Germany. He noted that top managers of some worldwide ag equipment brands were in attendance. It underscored the importance of programs like Starke Typen.

“Service is the most important thing,” Beckschulte says. “If you do not have service as the seller, and if you cannot guarantee service for your machine, you cannot sell anything.”