alt Hacker NewsI wonder how sustainable the business model is. Eventually, you saturate the market with your tractors, and if they work as advertised, they are owned and maintained for decades. A lot of people are out there farming with 60-80 year old tractors. I would suspect most of the OEM parts that need replacing are where most wear and tear is happening (the engine). Those parts come from Cummins, not this startup.
In the meantime, they have to maintain a very high fixed cost base in their factory, distribution network, and skilled unionized workforce. I'm really not even asking about how will they maximize shareholder dividends, I just mean how do you not go bankrupt after you sell your first 10,000 tractors.
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The disincentive to provide a durable product is unfortunate. Ideally businesses pair high-ticket one-time sales with low-cost recurring sales of related products and services.
Study history. Tractor businesses have operated successfully from the 1930's through the 1990's using this model. Those tractors are still running and still serviceable. (I've run a Farmall Model H from the 50's and IH-576 from the '70s as recently as five years ago... they are built to last and parts are plentiful or easily reproduced... and International Harvester is still in business (maybe under the Case name now.)
These subscription-based and planned-obsolescence fads are experiments that will run their course. In the end, business will thrive where they meet consumer demands, not because their business model was proposed in some boardroom.
The solution is not to make tractors that should be replaced every 10 years, right? The company can take the know how and move to disrupt other machines
Must we sell more than 10,000? That seems like a reasonable check for a small business to take home and go solve some other problem for someone.
The thing is, your reputation will get out there. Folks will want to work with you because of who you are; it'll be profitable (in many ways) even if it isn't a 100-year dynasty.
> maximize shareholder dividends
This is the whole reason why middle class is dying and power and wealth are being consolidated amongst the rich.