Tractor prices rise on revised steel rates

Tractor manufacturers in northern India have decided to revise prices in the next financial year beginning April 2008. The unexpected surge in the prices of steel, the major component in tractors, is responsible for this rise.

The major tractor manufacturers in the region "" Punjab Tractors Ltd, International Tractors Ltd, Indo Farm Tractors and Motors Ltd and HMT Tractors "" are all in the process of an upward revision of price.

The vice-president of International Tractors Ltd, makers of Sonalika brand of tractors, AS Mittal, told Business Standard that a tractor of 31 brake horse power (bhp) may cost Rs 10,000 more after April. The prices may rise about 3 per cent for the tractor industry in general.

Punjab Tractors Ltd, that hit the headlines when Mahindra and Mahindra acquired 43 per cent stake in the company, is also planning to revise the prices between Rs 12,000-20,000 from October this year, sources said.

However, the manufacturers are optimistic that the debt relief announced by Finance Minister P Chidambram in the Budget will help accelerate the sluggish demand for tractors in the next few months.

The vice-president of Indo Farm Tractors and Motors, CM Dhar, said, "The prices of our brand may be revised by around Rs 7,000-8,000."

The officials of HMT Tractors were not available for comments but sources confirmed that the company has decreased its annual target from 5,000 tarctors to 4,000 tarctors for the current financial year.