Spurred by surging demand M&M scouts for site to set up new Swaraj Tractor plant, Auto News, ET Auto


M&M cumulatively rolled out 286,846 tractors between April 2020 and January 2021, up 12 % year-on-year.
M&M cumulatively rolled out 286,846 tractors between April 2020 and January 2021, up 12 % year-on-year.

New Delhi: Officials of the Mahindra & Mahindra Ltd’s Farm Equipment Sector (FES) are in talks with a few state governments for land to build a new tractor manufacturing plant under the Swaraj brand to cope up with the rising demand, according to industry sources.

The company’s preference is for the northern region of India to set up the additional capacity, a source aware of the development said.

M&M leads the tractor segment with over 40% market share. It has three manufacturing units (including a foundry) and an R&D centre for Swaraj-branded tractors, all in Punjab, with an annual production of 120,000 units. According to company data, M&M cumulatively rolled out 286,846 tractors between April 2020 and January 2021, up 12 % year-on-year.

The company has been witnessing unprecedented post-pandemic demand for its tractors in the domestic market because of the strong rural growth, favourable unlocking conditions, healthy reservoir levels and good price realisation of crops.

Hemant Sikka, President – Farm Equipment Sector of M&M, told ETAuto that the company had to literally ration tractors from the export market to cater to the domestic demand.

“Till Diwali we were not exporting tractors even though we had customers waiting with firm orders. After Diwali we prioritised exports over domestic sales and we were able to service all our customers. Now we are catching up and reducing the back orders,” Sikka said in a recent interaction.

These factors clearly indicate that the company has to fast-forward its plans to select a new site for capacity expansion.

The sowing of Kharif crops is up 3% on a year-on-year basis and 7% higher than the average of the past 10 years. Overall we expect the industry to do well even in FY22.Hemant Sikka, President – Farm Equipment Sector of M&M

When asked about India’s readiness for electric tractors, Sikka highlighted that scaling up electric-drive technology in this segment is not feasible now owing to the diverse soil patterns and climatic conditions coupled with charging challenges. “However, that doesn’t mean diesel will always reign supreme; multiple solutions like CNG can coexist,” he pointed out.On the outlook, the M&M Tractor chief expects the healthy growth in the tractor industry to continue in FY 2021-22 as well led by good harvest and improved rural income.

“This has been a very good year and we are expecting 20% growth rate for the industry in the current financial year. For the next year, early estimates indicate a good monsoon. The sowing of Kharif crops is up 3% on a year-on-year basis and 7% higher than the average of the past 10 years. So, overall we expect the industry to do well even in FY22,” he added.

In November last year, the Mahindra Group announced its plan to manufacture a new tractor series called ‘K2’, exclusively at the company’s tractor manufacturing facility at Zaheerabad in Telangana. It is the youngest and largest tractor manufacturing facility in terms of capacity. This plant also produces Mahindra’s Rice Transplanters and Tractor Mounted Combine Harvesters.





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