Damn. It’s already 2025? I was just getting used to the idea that it was 2024.

Today, Lloyd and I are reflecting on what worked and didn’t work in our used machinery business and our personal lives over the last year. We’re also discussing our intentions and predictions for the new year.

Will we sell more old multi-spindles in 2025 like we did this year? Will our incoming president be good for precision machining?

And how does it feel to turn 80?

Question: What are your greatest hopes and fears in 2025?

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Link to Graff-Pinkert’s Acquisitions and Sales promotion!

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Interview Highlights

Working Together

NOAH: It’s December 15th, 2024, and I am very honored to be with Lloyd Graff, my dad, my occasional co-host, and just a wonderful guy. It’s great to do this episode with you at the end of the year. We like to do this every year, sort of sum things up and look forward to the next year.

LLOYD: It’s a pleasure to be here. And I look forward to being here next year more than once.

NOAH: Tomorrow is Lloyd’s 80th birthday (Dec. 16). Happy birthday. So, how does it feel?

LLOYD: It feels great. It feels like a relief also, because in a way I’ve been dreading reaching this date and being decrepit. But I don’t feel decrepit. I feel lively and I feel like I still am capable of making a contribution in this business. And I am so grateful for a wonderful family.

NOAH: I think it’s wonderful that you’re still so engaged in the business still.

LLOYD: I’m engaged as much as ever. I do not work as many hours as I once did. I find that I can be effective working four or five hours a day at the office and working at home. At 4:00 AM, at times.

NOAH: I feel like it’s just not as fun if you’re not there, so I’m grateful that you still come in.

LLOYD: Oh, thank you.

NOAH: There’s just a different energy. Even if I talk to you on the phone frequently, it’s definitely a different energy when we’re not talking in person.

Success of Used Machinery Business

NOAH: So where has Graff-Pinkert found the most success this year? It’s been a decent year for us in the end. Is it because of what we’ve done? Is it because of what the economy is doing? Is it because of luck? Probably a little bit of all three.

LLOYD: I would agree with that. I would say that the success of Graf Pinkert has been in machinery deals selling multiple machines, of various types. INDEX multi-spindles, and various other types of CNC equipment.

We also sold seven Davenports to India, and they’re talking about buying five more. And we liquidated a dozen old multi-spindles out of Sioux Falls, South Dakota—Acmes and New Britains.

NOAH: If you can buy those old machines for very cheap and sell a whole bunch, you can do well. But few people are paying top dollar for cam machines.

LLOYD: Yes. But, we have a Wickman Spare Parts Department, and that’s done quite well.

NOAH: So, they’re keeping their machines. It’s not like they’re throwing out their Wickmans. They’re just choosing to fix them and not doubling down on them.

Current Automotive Climate

NOAH: Another topic we’ve been discussing lately is Europe’s difficulty in it’s machining sector.

LLOYD: It’s dismal because particularly because European automotive is very weak, very weak. Mercedes, BMW, and especially Volkswagen. Volkswagen, whatever decision they make, seems to be the wrong one. Their efforts to manufacture in the United States have been feeble and misguided and they keep going right and left on the cars that they manufacture. So, basically, as far as an American market for VW, it’s been very weak, and now they are doubling down on the electric cars. That appears to be a dubious decision, particularly as far as the American market is concerned.

NOAH: Why do you say that?

LLOYD: Well, the only American manufacturer who’s been successful selling electric cars is Tesla. And a lot of our clients are doing work for Tesla. But Ford, GM, they have been unsuccessful with electric cars. They’re now cutting back and slowing down on electric. They have also not been successful in developing self-driving cars. Now Tesla says they are going to. But it’s so far it’s just smoke and mirrors. The only people who’ve been truly successful, at least in the United States, is Waymo.

NOAH: Tell people who Waymo is for the people who don’t know. Because I think a lot of people don’t know. And what our connection is.

LLOYD: My son in law, Scott, works for Waymo. Waymo is 92 percent owned by Google. Google has the money to implement the research. They have the people who have the knowledge to make the research work. And they are willing to be patient and develop the market slowly and wait for the regulations to be covered.

Predictions for Precision Machining in 2025

NOAH: Let’s just do a little predicting about what 2025 will be like. And of course it’s impossible to tell.

LLOYD: We have a new president coming in. We have a world situation, which is chaotic. It is difficult. But on the other hand, we have low inflation, although we’re coming off a period of fairly high inflation post-Biden early years.

There’s hesitancy amongst consumers because of the past history of high inflation and it makes people reluctant to spend. But they are starting to spend. Automotive looks like it could be a better year because the automotive companies are not obsessed with building electric cars anymore.

I think the American builders have basically given up on the idea of building electric cars in the United States, at least temporarily. They’ve abandoned that market to Tesla.

The Korean companies have their share, the Japanese companies have their share. And they have manufacturing plants in the US, at least assembly plants.

What we do see is military is strong. And I anticipate that will continue. Medical continues to bounce along and be moderately strong.

Aerospace has been very difficult in the United States because Boeing is your biggest customer other than the Air Force.

The firearms business, it’s up and down.

NOAH: So it seems like most of our customers are excited about the new President.

LLOYD: The only thing that is a negative sign, at least in my opinion, is the tariffs as a possibility. While I think it’s mostly a bluff by Trump, we don’t know.

What we learned in 2024

NOAH: What was something interesting you learned in the business this year?

LLOYD: Graff-Pinkert cannot do all deals by itself. First of all, we don’t have enough money. But secondly, more than the money, the money we could obtain if we want to, but what we need are the contacts, the connections, the specialized knowledge, this is what is essential often in making the deals that really count.

NOAH: One thing I’ve really tried to embrace recently is that although goals are great, it’s vital to take a step back and say, “take a breath and enjoy this process.” There’s so many interesting, good things going on. And I’m going to keep looking to the future, but I’m going to just ride this wave, because before you know it…

LLOYD: You’ll be 80.

NOAH: All right. Well, happy 2024.

LLOYD: Happy 2025.

 

 

 

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