Manufacturers focusing on smaller tractors

As sales slow down, tractor makers are looking at smaller tractors which are gaining popularity among farmers with smaller land parcels and for specialised use.

Mahindra & Mahindra (M&M), which is already into the small tractor segment (sub-20 horsepower), is looking at a nationwide rollout of its Yuvraj brand of mini tractors by next year. Yuvraj is currently available in eight states. Similarly, Escorts has announced its new range of small tractors, targeted at niche requirements.

M&M sells around 1,000 small tractors a month, while Escorts will initially target a number of 200 units a month and 1,000 units going ahead.

“As Indian farmers get more specialised, they are finding mini tractors more suitable for their kind of requirements. While Mahindra’s Yuvraj tractors are targeted at smaller farms, ours will be more suitable for intra crop kind of a condition, which will be slightly premium compared to Yuvraj. These tractors are 15% more expensive than Yuvraj,” said S Sridhar, CEO, Escorts Agri Machinery.

Despite the slowdown in mid-sized tractors over the last 4-5 months, the industry is expecting an overall growth of around 13% for the curent fiscal. The growth for this fiscal is likely to halve.

“This is the fifth month in a row that we are seeing tractor growth coming down. In February sales fell 10%. The growth has come down majorly due food inflation getting negative. Farmers are not getting good prices on their crops. Hence, we will have to wait and watch the next 3-6 months in order to understand the market scenario,” said Sridhar.

Also, smaller tractors would bring in a new set of customers and open up new opportunities.

Tractors and Farm Equipment Ltd (Tafe) recently announced its entry into application-focused compact tractors in the sub 20HP segment.

“Players will start looking at specialised and niche products in order to offset the current slack in demand in the tractor industry,” said Sridhar.

“With such tractors we are expanding our customer base. We want to bring more farmers into tractorisation. In small farms (2-5 acre), the tractor penetration is just 1% and Yuvraj can cater to such requirements. That’s the kind of transformation M&M is looking at,” said Sanjeev Goyle, senior vice-president marketing & Applitrac, M&M. “So far the demand of such tractors has been good and it opens new and niche markets for us,” he said.