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M&M drives up Africa focus to make up for US losses
Posted on 24 Jun 2009300 Views Comments
Mahindra & Mahindra to Export SKD Kits To Africa, Plans Assembly Units There
With more than one-third of tractors sold in Africa being imported, M&M sees a huge opportunity here. "There is a propensity among buyers in Africa to be brand loyal and that works in our favour," said Anjanikumar Choudhari, president of M&M's farm equipment business. M&M's tractors are marketed as fuel-efficient and technologically-superior vehicles. While the volumes are still low, it has sold around 1,600 tractors till date in this market.
M&M marketed tractors in the 25-40 hp category for the US markets. With the US housing sector taking a dip in the recent past, 'hobby' farmers have been going slow on new purchases of tractors, said Mr Choudhari. M&M has been present in the US market for more than 12 years and has sold more than 60,000 units. The company has been expanding marketing efforts through new launches in the US through its subsidiary Mahindra USA.
Mahindra, which has a large base in India, is also increasing its presence in China, America and Australia. To expand into the growing tractor market in China, Mahindra acquired majority stake in Jiangling Tractors. It has a combined capacity of more than 50,000 tractors in China with its two ventures - Yancheng Tractors and Mahindra China Tractor. Tractor sales in India grew by 0.5% to 3.03 lakh units during the year ended March 2009, while volumes at M&M, which included eight months of sales of Punjab Tractors's Swaraj brand, grew 25% to 1.13 lakh units. Following the recent merger of Punjab Tractors, M&M has a 40.6% share of the tractor market, with the Swaraj brand's share rising by about 2.5%. Punjab Tractors has two plants with a capacity to make 60,000 tractors, while M&M has four plants to manufacture 1.3 lakh units.
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