OEM incentives drive buyers from used construction equipment to new machines

United States, September 11, 2025

News Summary

Used construction equipment is steadily disappearing from dealer lots as original equipment manufacturers ramp up promotional financing, extended warranties and technology packages that make new machines more attractive. A dealer survey across 150 locations found 80% met used inventory targets in Q2 and 90% reported steady or improving demand, yet aggressive interest-rate buydowns and 0% financing narrow monthly-payment differences and pull purchases toward new units. Dealers are purging late-model units, shifting machines into rental fleets, or timing buys for tax benefits. Market balance may return if promotions ease or used pricing adjusts.

Used construction equipment is vanishing from dealer lots as new-equipment incentives bite

Dealers report fewer used machines on their lots as aggressive incentives for new equipment shift buyer decisions. A recent industry survey of dealers representing 150 locations shows the move toward promotional financing and package deals is changing how dealers price, hold and route late-model machines.

Top-line survey results and market snapshot

The survey found that 80 percent of construction dealers met used inventory targets in the second quarter, and 90 percent said demand for used equipment was steady or improving during the same period. Stable used-equipment prices and a market that showed resilience despite tariff uncertainty helped drive those results.

Why used inventory is getting harder to sell

Manufacturers are offering a growing set of incentives on new machines. The three most common offers reported by dealers are interest rate buydowns, extended warranties, and technology upgrades. Interest rate buydowns are currently the most widely used tool. Promotional finance terms as low as zero percent make monthly payments on new machines close enough to those on used machines that many buyers now prefer new machines.

Those incentives are leading to direct competition between new machines and late-model used machines. Dealers say when the price-for-price math lines up and a new machine comes with attractive financing or extras, sales teams and buyers often favor new equipment. As a result, dealers are purging some late-model inventory — especially models that are one to two years old — which no longer offer a strong enough value gap versus new machines.

How dealers are adapting

Responses in the survey show dealers taking several approaches: some are pricing to move certain used machines quickly, others are adding late-model units to their rental fleets for six to 12 months to earn revenue and add hours before resale, and some plan to increase used inventory later in the year to take advantage of tax rules such as 100 percent bonus depreciation.

For the near term, dealers expressed mixed expectations for Q3: 40 percent expect used inventory levels to increase, while another 40 percent expect levels to stay the same. The potential build-up for year-end tax strategies is a key reason some dealers plan to load up on used machines.

Market forces beyond financing

Strong commercial developments and healthy homebuilding in certain regions continue to support dealer activity. At the same time, stable pricing and resistance to tariff shifts helped Q2 outcomes. Still, dealers are watching the combined effect of promotional financing, extended coverage, and tech packages — a mix that some industry respondents called a perfect storm for new-equipment demand.

Local construction work and community projects

Community-level construction projects illustrate demand for equipment and contractor work. A recently completed playground reopened after years of planning and fundraising. The project replaced worn and unsafe equipment with new facilities that include areas for 2-to-5-year-olds and 5-to-12-year-olds, monkey bars, slides, a jungle gym, and swings for infants, toddlers and older kids. The rebuild required coordination with engineers and outside funders, and construction faced delays from weather and an unexpected underground storm pipe replacement.

Local partners and grants provided core funding, and private donors supplied materials and labor support. The finished playground is expected to serve neighborhood families for many years and highlights how public projects depend on a mix of grants, donations and municipal planning — all of which require equipment, contractors and supply chains that feed the broader construction equipment market.

Community recycling and material handling tie-ins

Local sustainability programs offer seasonal recycling events where residents can drop off items that do not fit regular pickup. These events accept sensitive documents for shredding, electronics, batteries, textiles, cooking oil, and even unadorned pumpkins for composting. They also include food drives and special collections for items that help reduce landfill waste. Such events underscore the community side of construction and public works, where equipment and crews handle logistics, waste diversion and site cleanup.

What this means for buyers and dealers

• Buyers looking at late-model used equipment should compare total monthly costs rather than sticker price alone, since promotional financing on new machines can close the gap.
• Dealers may increasingly shift late-model machines into rental fleets or price them aggressively to move inventory.
• Year-end tax rules could prompt a temporary rise in used inventory as dealers position assets to benefit from bonus depreciation.
• Community projects remain steady demand drivers, linking local public work to wider equipment cycles.

FAQ

Key features at a glance

Feature	Detail
Survey size	Dealers representing 150 locations
Q2 used inventory targets met	80 percent of dealers
Q2 demand for used equipment	90 percent reported steady or improving demand
Top OEM incentives	Interest rate buydowns, extended warranties, technology upgrades
Q3 inventory expectations	40 percent expect increase, 40 percent expect same
Dealer tactics	Price to move, add to rental fleet, capitalize on tax benefits
Local project example	Playground rebuild with new play zones and safety upgrades
Community recycling tie-in	Seasonal Green Day events accept electronics, batteries, textiles and more

Deeper Dive: News & Info About This Topic

Additional Resources

• Equipment Finance News: 80% of construction dealers hit used-inventory goals
• Wikipedia: Construction equipment
• Equipment Finance News: Dealers turning page on troubled used-equipment market
• Google Search: used construction equipment market
• Equipment Finance News: Dealers refresh rental fleets as OEMs push new equipment
• Google Scholar: equipment rental fleet management
• FoxYNC: Get ready to dump the junk in Morrisville
• Encyclopedia Britannica: waste management
• LevittownNow: Special blanket used to stop burning Tesla
• Google News: EV battery fire suppression blanket