Tractors are integral to the economy of a country, especially if the economy is an agriculture-based economy like India. Farming is still not fully mechanized in India and yet India is already the worlds largest market for Tractors. The market for tractors in India constitutes 36% of the world market which stands at around 8 lakh tractors per year. The market for tractors grew substantially during the green revolution in India.
Mahindra and Mahindra is
the largest Tractor manufacturer in India. Tractor supply by Mahindra and
Mahindra is to countries like the U.S.A, Nepal and African countries like
Uganda. The business of Tractor supply can include designing, developing &
manufacture of tractors and implements used with tractors. A strong
dealership network is the backbone of the business, especially for
Agricultural tractors supply as the sales for these are seasonal. Foreign
tractor suppliers like Renault and Caterpillar are also supplying tractors
in India.
The other large markets for Tractors are U.S.A, Italy and Australia.The
Indian market can be broken down into tractors of 25 HP, 26 - 45HP and over
45HP.These have a market share of 20%, 60% and 20% respectively.The most
competitive segment happens to be the second mentioned segment which also
witnesses the most innovative strategies in marketing to push sales.
An interesting development has been the removal of import duty on second
hand tractors in India. This is offering competition to the new vehicles but
even then the cost base in India is so efficient that indigenously
manufactured tractors are quite reasonably priced. Tractors are supplied by
Indian companies to Sri Lanka which imports 50% of its Tractors. When
supplies happen from a lot of places then the end user gets exposure to
tractors with international features to some extent.
The business of tractor supply is heavily dependent on referral purchases
and word of mouth advertisement which is by far the most influential factor
in a persons decision of the brand of tractor.
Tractor suppliers have to decide on the quality that will ensure a customer loyalty and prevent a switch as most tractors offer the same features. This is the reason why some suppliers have decided to give the customer the option of customized colours while others bank on their dependable dealer network to provide fast and ready service as the tractors are basically slow – speed vehicles.
A good monsoon and
retail financing are the two most important drivers for tractor supply in
India.
Tractor supply ~ author L.S.Batra. copyright data 2004 Indianchild.com
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