Eicher Tractors Ltd (ETL), a part of the Rs 1,000-crore Eicher group, has signed a joint venture agreement with the Valtra group of Finland for launching high-power tractors.
The venture will unleash two models with 50 and 60 horse power engines by the year end, a company official said. ETL will manufacture the models at its Bhopal facility, R C Jain, managing director of the company, said here yesterday.
The technology will be provided by Valtra and engines would be produced at ETL's Alwar, Rajasthan plant, Jain said. The products would have advanced features such as front power take off (FPTO) system, power steering and a modern gearbox.
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"Currently field-testing of the two models are going on and after getting more feedback from the test report, suitable changes according to Indian conditions will be made," he said.
The domestic tractor market is traditionally dominated by small vehicles mainly in the 24-42 horsepower category due to the small average farmholding size in the country.
A couple of international players such as New Holland and International Tractors are entering into the powerful tractors segment as they feel there is a good potential for these kind of models.
Eicher is currently producing four small tractor models with 24, 30, 35 and 42 HP engines and holds a market share of around 34 per cent, Jain claimed.
Other leading players such as Mahindra and Mahindra has a market share of 30.8 per cent in the small tractor segment followed by Escorts (13.2 per cent), HMT (9.8 per cent) and others (12.5 per cent), he said.
The 50-HP tractor of ETL would be priced in the Rs 3-3.5 lakh range, while the 60-HP model would attract a price between Rs 4-5 lakh, Jain said.
The company has invested over Rs 70 crore in the project and targeted to indigenise 95 per cent of the components by 2,000.
ETL recorded a sales growth of over 4.4 per cent during the just ended financial year as against the industry growth of 3.4 per cent, he said. It sold 18,700 units of 24 HP model, 12,00 of 30 HP model and 5,500 of 35 HP category during 1998-99 as compared with 17,000, 700 and 6,000 units, respectively, in the previous year.