The Italian tractor manufacturer, Same Deutz-Fahr (SDF) Group has announced plans to invest an estimated four million euros ( Rs 23.5 crore) in India. And on hand in India to make the announcement was chairman Vittorio Carozza, who also visited the Group’s wholly-owned Indian subsidiary Same Deutz-Fahr India (SDF) in early April, his first visit in four years.
Carozza also launched a couple of tractor models aimed at helping the Indian arm increase its sales even as it aims to cross the 10,000 mark in three years' time.
The Rs 23.5 crore investment will be used to enhance the capacity of the Group’s Ranipet plant, 120km away from Chennai, from 6,000 to 15,000 units in three years. Lodovico Bussolati, general manager of SDF, says the investment in India is twice as much as the Group plans to invest anywhere else in the world, underlining the importance of the Indian market to SDF.
SDF (India), which has a presence in the 50 hp-plus segment has launched a 35 hp tractor – Same 36 Di – to garner volumes as well as an 80 hp tractor – Deutz-Fahr Agrulux Profiline – in the high-power segment. The company’s existing portfolio comprises four models (50, 55, 60 and 70 hp) in the Deutz-Fahr range and one for the export market which is an under 75 hp tractor. Under the Same brand, the models offered are in the 40, 45, 50 and 60 hp range.
At the launch function, Francesco Carozza, chairman of SDFI and VP (overseas business unit), SDF Group, said the company will introduce CVT (constant variable transmission) in tractors ranging from 100 hp to 400 hp and introduce new models in conventional combined and rotary combined harvesters. “In addition, we intend to strengthen our full line agreements with OEMs including Kuhn-Kverneland to boost sales,” he said.
Carozza said the company will continue to work with Deutz AG on new product development. “SDF India is the first company in India to make agricultural Euro 3 turbo engines and 80 hp four-wheel-drive tractors with a Euro 3 engine. The Agrolux Profiline 80 will have front/rear braking systems and synchronised reverse shuttle," says Andrea Bedosti, executive vice-president (sales, marketing and aftersales) SDF.
He adds that while the tractor market in Europe and North American will show a downtrend trend and sales in Africa are likely to be flat, the growth markets are India, China, Russia and Latin America. The Group’s order portfolio showed an 11.5 percent increase for 2010 as against 2009.
In order to achieve a sales target of 10,000 units, CEO of SDF India, Gopi Nambiar says the company has made changes in the plant’s layout. It has set up an air-conditioned engine assembly plant with equipment including multi-stage washing machines and a new line in the transmission assembly for more manufacturing flexibility. Equipment including EVAC automatic brake bleeding machines have been installed to facilitate brake testing.
Nambiar says, "The new machine helps fill brake fluid in the entire braking circuit while ensuring that the trapped air inside the brake pipes (circuit) is removed completely and none of the joints are leaking.” Besides, SDF India has also installed programmable torque-controlled nut runners for critical joints. The post-paint assembly line is being developed and is expected to be fully operational before the last quarter of this calendar, Nambiar adds.
India likely to become SDF global tech centre
By 2011, SDF India is likely to become the Group’s global technical centre for design and development of engines and transmission. At present, the company is working on models of less than 35 hp to tap the larger segment of customers.
Over 50 percent of the total tractors sold in India are below 35 hp, a space in which the major tractor players in India have an offering. Small tractors are popular because over 60 percent of the India’s farms are less than one hectare.
The company is also working on developing engines for gensets with a capacity ranging from 62.5 KVA up to 125 KVA and four-cylinder tractors for export markets.
The Indian arm is also exporting components to its Group companies. Last year, it exported about 125 components worth an estimated Euro 5 million (Rs 29.3 crore) to the parent company. This number is likely to be increased by 25 in the current year which will eventually increase the components exports by 20 percent in value terms, Nambiar says. The focus will be on critical components including cylinder heads and oil pumps.
Last year, the company introduced high-reverse speed for dozer applications, two-speed PTO (power take-off) with synchronised speeds, creeper speed gearbox for trenchers, 10 and 15 forward and 10 and 15 reverse shuttle gearbox for exports and hydraulic lift with capacity up to 2,500kg.
In 2010, the company hopes to introduce heavy-duty front axle tractors for construction applications, reduced power loss transmission for lower horsepower tractors and modified three-point linkages for certain specific markets including Punjab.
The company also plans to appoint new dealers in most parts of the country, adding 35 new dealers to its existing network.
An estimated 370,000 tractors were sold in India in 2009-10 and as per industry estimates, sales will cross 420,000 in three to four years. The growth in tractors in India is due to demand in the agricultural business and for applications in the construction industry such as loaders, dozers and equipment for road building.
In 2009, SDF India sold 3,300 tractors including 1,400 units in the export markets. It also manufactured about 5,000 engines of which 40 percent were exported.
SDFI hopes to make 5,800 tractors this year. To support sales, it plans to expand its cooperation with banks to help customers get convenient funding. Recently the company inked tie-ups with L&T Finance, Sundaram Finance and Shriram Commercial Vehicle Finance. Talks are in final stages with Indian Bank, Canara Bank and Federal Bank, says Shripad Shidore, commercial director & board member SDF India. He says that Tata Capital, Andhra Bank and Allahabad Bank have also evinced interest while Punjab & Sind Bank, Bank of India and Bank of Baroda have been shortlisted. n