M&M lines up Rs 400 cr expansion

Mahindra and Mahindra Ltd today announced plans to invest Rs 400 crore in setting up a new plant to make tractors and expand the capacity at its Nagpur, Jaipur and Rudrapur production facilities.

The company is also setting up a third tractor assembly plant in the United States with an initial capacity of 3,000 tractors. It plans to scale it up to 15,000 units a year. The new unit will be in California. The company now has two plants in the US, one in Texas and the other in Gorgia, with a combined installed capacity of 12,000 units in the 40-70 horse power (HP) tractor segment.

A Choudhari, president, Farm Equipment Sector, Mahindra, said: " We are currently scouting for ideal location in India. We have identified two to three possible locations and we are talking to different state governments. The new plant will have a minimum annual production capacity of 40,000 units of tractor and will be operational in the next 18 to 24 months."

Mahindra plans to achieve the production capacity of 1,20,000 units during this fiscal. Production at Jaipur facility will go up to 15,000 units from the current 10,000 units, while that of Nagpur plant is being increased up to 50,000 units and Rudrapur plant will be producing 39,000 units this financial year. Mahindra has sold 50,923 units of tractor in the fist half of the fiscal, registering a growth of 29 per cent over last year. Mahindra has also started production from its Brisbane assembly facility in Australia and will be enhancing its present production capacity of 3,000 units in China.

"We are eyeing the huge demand in farm equipments from the growing economies," said Choudhury.

Besides the already tapped America and China markets, we are negotiating with many African countries like Mali, Nigeria, Syria to set up different assembly and production facilities.

Negotiations are also in advance stages to establish a new tractor facility in Iran and some positive developments are expected soon." The company today launched its new multi-utility tractor 'Shaan' powered by a 23.5 HP engine.