MUMBAI: John Deere, the American farm equipment maker's strategy to use its Indian subsidiary to make tractors for its home base is beginning to get results, enabling the company to get a measure of its Indian rivals who have made inroads into the US market.
John Deere's Indian unit manufactures relatively less expensive and low-powered 55 to 75 horsepower tractors for the US market that cater to small-holding cultivators and hobby farmers. “About 50% of our tractor exports go to the US... We are filling in the overall portfolio that John Deere has for the customers in the US,” Satish Nadiger, MD, John Deere India, told ET.
To be sure, these tractors make a small portion of the 182-year old, $37 billion company’s portfolio in the US. This is in line with the emerging trend of the US becoming the secondlargest export market for vehicles manufactured in India after Mexico.
Companies such as Ford, along with German Luxury carmaker Mercedes, are some notable manufacturers exporting to the US from India.
John Deere India exports around 30% of its production volume to more than 110 countries around the world, Nadiger said. The company has an installed manufacturing capacity of 1.32 lakh units a year at its tractor manufacturing plants at Pune and Dewas. At its technology centre in Pune, products are developed for the local market as well for some other countries.
Last year, they produced 1 lakh tractors and managed to sell about 98,000 of them, said Nadiger. The company started operations in India as a joint venture with Larsen & Toubro two decades ago in 1998. While L&T exited the venture in 2006, John Deere continued operations, and today it commands a 9% share of the tractor market here.
Source: economictimes.indiatimes.com