Market Characteristics:

Despite the growing availability and sales in the higher HP utility tractors in the category 2 (50 -100 HP) and even in category 3 (100-180 HP) the average HP remains between 40 and 45 HP.

While the industry remains very competitive nationally and internationally and with ever increasing numbers of OEMs, the manufactures are offering quality improvements in engine efficiency and emissions, better selection in transmissions, power steering, etc., they have also managed to keep prices down by limiting offerings in digitalization (little or no use of engine control modules- ECM) of the engine-tractor, roll over protection systems as optional, and the other bells and whistles for operators that come as standard options elsewhere.

Very competitive and widely available repair services due in part to keeping things simple (no ECMs, etc.).

Sales are also driven as the "agricultural" tractors are widely used in providing commercial transport services in rural and peri-urban areas. The cost of a tractor and trailer are much less than the higher speed commercial truck offerings in the 1 - 5 ton sector.

Prevalence:

Tractors are getting widespread acceptance in India.

Kotaks and ICRA reports estimate that nearly 4.3 million tractors were in operation, and 1 in 20 rural households owned a tractor in 2011. They project that the market will grow at 7% to 8% per year, and only 19% of Indian rural farming households that can afford a tractor have as yet purchased a unit.

Designs that allow multi-functional use, adapted to local needs and rural constraints, are experiencing higher demands.

Market Share:

Five companies account for over 80% of the market share

Mahindra and Mahindra (largest at 42.5% share)

TAFE with 20%

Rest

Escorts,

ITL-Sonalika

John Deere.