Tractor firms rattled by huge dealer inventories

Govt urged to defer new emission norms

The Tractor Manufacturers' Association (TMA) has written to the government seeking deferment of tractor emission-III norm by six months following a pile-up of TREM II-compliant tractors at dealer outlets.

Unlike other segments of the automobile industry where the Bharat Stage-III emission norms will be implemented only in 12 cities, the TREM-III implementation will be applicable across the entire country.

Industry sources said the over 45,000 to 50,000 TREM II-complaint units lying with dealers has forced the association to seek extra time for implementing the new standards.

"Though most tractor manufacturers are ready to manufacture TREM-III complaint tractors, we have written to the government seeking time till end of September for implementation of TREM-III," said R C Jain, president, TMA.

Sources in the industry said the request for deferment up to the end of September is likely to get the government's nod owing to the strong farm lobby.

The reprieve to push the implementation of the new standards is also sought keeping in mind the start of peak season for tractor sales that begins in March and stays for four months. The TREM-II stock is not likely to find takers if TREM-III is implemented from April 1, 2005.

It is also learnt that the price of the tractors complying with TREM-III standards are expected to be costlier by 2-2.5 per cent or Rs 6000-8000 per unit.

TMA sources said the current financial year will see total sales of 2,45,000 units or close to 30 per cent more than the previous year's sales.

Industry source said that M&M has clocked sales of 47,000 units for the nine months ending December 2004. The other major players in the market are Eicher (13,700), Escorts (26,100), Tafe (24,200) and Punjab Tractors (22,300 units), and Sonalika (19,300 units).