In a sign of reviving rural demand, tractor players M&M and Escorts posted a double-digit growth in sales in February 2020.
M&M’s farm equipment sector (FES) said its domestic sales in February 2020 stood at 21,877 units, up 21% from the year-ago month.
Exports, though, dropped 22% to 683 units, taking total tractor sales during the month to 22,561 units. This is a growth of 19% from February 2019.
Rajesh Jejurikar, president, FES, M&M said, “the tractor demand trend is expected to strengthen on the back of a robust rabi output and the prevailing crop prices. Going forward, the increase in rural and agri- spending on core schemes by the government should augur well for the industry.”
Escorts said its agri-machinery segment sold 8,601 tractors, registering a growth of 18.8%. Domestic tractor sales grew 16% to 8,049 units and exports rose to 552 tractors from 322.
Supply chain disruption
Already reeling under subdued consumer sentiment, the domestic sales of two-wheelers were further hit by supply chain disruptions due to the COVID-19 outbreak. Except for Royal Enfield and Suzuki Motorcycle India, almost all other players posted a decline in wholesales.
Market leader Hero MotoCorp reported a 20% fall in domestic sales to over 4.8 lakh units while Honda 2Wheelers India said it sold over 3.15 lakh units in the country, a fall of almost 23%.
“... the ongoing COVID-19 issue had adversely impacted production at manufacturing facilities in India in February. Since then, substantial progress has been made in developing alternate sources for procuring components.
Meanwhile, component makers in China, having restarted production, are also expected to resume normal supplies soon,” it said. Bajaj Auto saw a decline of 21% in domestic two-wheeler sales to over 1.46 lakh units while TVS Motor posted an over 26% decline in domestic two-wheeler sales to over 1.69 lakh units. Royal Enfield and Suzuki Motorcycle India saw 2% growth in their domestic sales in February.