> it still has all the capability it had when they paid for it, and so it is just as "valuable" [to the original purchaser]
If this is the case, how can it have depreciated down to $0? I feel like I missed a key concept somewhere. With all the functionality of a new lathe, it must be worth something over the value of its materials as scrap... right?
Most machine shops (production shops at least) are not purchasing new manual machine tools. Manual machine tools, even tool room (i.e. high precision) machines, like mills (and shapers) and lathes represent little or no value to commercial enterprises due to the labor costs and productivity relative to CNC machine tools.
Thus, there are an abundance of used manual machine tools on the market, now they are irrelevant to the manufacturing industry. They remain difficult and expensive to move. They are very heavy take up lots of space, and may have special electrical power requirements. Their capability is also a function of tooling, which may, or may not be readily and cheaply available when obtaining the machine. So, despite the bargain that used manual machine tools represent, they are not likely impulse purchases.
If I had the space, I would love a Monarch 612. You can get them for scrap prices, but its just far too impractical to consider.
A manual tool that can still hold the same tolerances it did when it was new, in the hands of a skilled machinist, is worthless. Because a Haas machining center[1] can hold the same tolerances with an operator who has a 2 year certification degree.
So machine shops don't want (or need) the old manual tools, and yet they still work fine. Great way to build small arms on the cheap :-) If I ever retire to a ranch with space for a machine shop I'll collect these sorts of tools.
Short version is the market is not smooth and has very asymmetric knowledge and gaining the knowledge the hard way with measurement instruments is a time consuming specialized skill.
I know all about the condition of the bearings in the headstock of my lathe... you most certainly don't and if you're wise you'll hedge your bets.
Also the market is fragmented. I like screwing around in my shop and do not care about revenue per hour generated. A job shop only cares about revenue per hour generated. I don't think the markets are going to make sense to each other, but people insist that selling machine tools is selling machine tools and it doesn't matter if the buyer is a for profit shop or an amateur steam engine tinkerer, unfortunately it does matter, a lot.
And edited to add, skilled people can see hidden value. Sure the ways are worn out on that worthless lathe and that worthless lathe had a trashed QC gearbox but hoarder dude knows how to combine the parts from both and sell the one good one for $2000. True, individually each is worth $0, but combined, with a skilled repair man willing to put in maybe 100 hours of hard labor... And tragically I've seen some semi-hoarding situations where the guy just gets too old... he could make that $2K which would be really helpful for a retired guy's budget, but doc just said no lifting anything and no standing for long periods, so other than praying for an apprentice, it'll sit there till the estate sale.
It has degraded functionality, worn bearing/tolerances etc. and will require some amount of maintenance or work to keep it going. i.e. it might be fine, or it might be fine with some applied effort by a knowledgeable person with more time then money.
Those things play off against the costs of "buying" the machine for a non-nominal sum - and also the likelihood of a quick sale.
If this is the case, how can it have depreciated down to $0? I feel like I missed a key concept somewhere. With all the functionality of a new lathe, it must be worth something over the value of its materials as scrap... right?