Tractor Sales Slip in U.S. While Canada Holds Steady
Tractor Trends Signal Diverging North American Markets
The tractor market is sending mixed signals across North America. According to the Association of Equipment Manufacturers (AEM), Canadian tractor sales remained stable or grew slightly through Q2 2025, while U.S. sales continued their year-long decline. These monthly stats focus on agricultural equipment, but they offer insight into smaller 2WD and 4WD tractors often used in landscaping, municipal work and rural hobby farming — the sweet spot for Compact Equipment readers. From the press release:
“The ongoing slump in U.S. combine and tractors sales demonstrates the market challenges facing the agricultural sector,” said AEM Senior Vice President Curt Blades. “We know farmers are hesitant to make major investments with global trade instability, high interest rates, and increased input prices. We’re encouraged by Canada’s continued strong performance throughout these summer months. The passage of the One Big Beautiful Bill Act is also a significant step forward for the agricultural equipment industry.”
Three Straight Months of U.S. Decline
In April, May and June 2025, U.S. sales of agricultural tractors dropped year over year. The steepest decline came in April, with a 13.3 percent fall in total ag tractor sales. That trend continued in May (-11.9 percent) and June (-4.4 percent). While combine sales were hit harder, the consistent drop in tractor units suggests ongoing market pressure. High interest rates, inflationary input costs and economic uncertainty appear to be holding buyers back. Equipment purchases for small farms and estates may be getting delayed or reconsidered as a result.
Canada Sees Modest Growth
Canadian tractor sales tell a different story. In June 2025, total ag tractor sales rose 1.6 percent year to date. The 4WD tractor segment performed especially well, up nearly 25 percent year to date by June. That followed strong performance in May (+35.6 percent) and April (+46.3 percent). The Canadian market has been more resilient.
What It Means for Compact Equipment Buyers
Compact and utility tractors — especially those in the 40 to 100 hp range — continue to be critical for small-acreage landowners, landscapers and contractors. While they fall under AEM’s ag tractor umbrella, they also power a wide variety of off-farm applications. For U.S. buyers, the current dip in sales could create opportunities. Dealers may offer discounts or more favorable financing to move inventory. For Canadian buyers, continued growth suggests confidence in these machines’ value.
Related Reads from Compact Equipment
Want to explore the latest compact tractor options and advice? Check out some recent features:
- Fitting a Need: Check Out Some Unique Tractor Options – Explore vineyard-ready units, articulating models and even electric prototypes
- Check Out Five Compact Utility Tractor Options – Compare machines from Bobcat, Massey Ferguson, Kubota, Case IH and New Holland
- How to Choose a Utility Tractor for Your Hobby Farm or Large Estate – A deep dive into horsepower needs, transmissions and cab comfort
- How to Pick Plow Attachments for Tractors – A timely look at snow removal options for compact tractors
Looking Ahead
With seasonal use peaking in summer and winter, compact tractor demand may bounce back as operators prep for fall harvest or snow. For now, all eyes remain on interest rates, inventory levels and whether Canadian growth can offset U.S. softness in the compact tractor sector.
Keith Gribbins is publisher of Compact Equipment.
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