Mahindra Charts Recovery Path for Global Farm Operations

As part of a new action plan for its international farm equipment business, Mahindra & Mahindra is realigning its operations after strategic write-downs in two major subsidiaries and continued headwinds in global tractor markets, the company said in a media interaction.

"The one area we haven't done as well as we would have liked is the international and export markets. This is because we've seen a significant slowdown around the world over the last year. So that's a space where we haven't reached where we wanted to," said Rajesh Jejurikar, Executive Director and CEO (Auto and Farm Sector) at Mahindra & Mahindra Ltd.

Mahindra’s domestic tractor business continues to perform well, with 407,094 units sold in the financial year 2025, up 12% year-on-year, alongside a 27% rise in exports to 17,547 units. Its international strategy now focuses on improving efficiency, introducing targeted products, and adapting to specific markets. North America, in particular, presents both challenges and growth opportunities.

The automaker has taken impairments of ₹79 crore for Sampo Rosenlew in Finland and ₹77 crore for Mitsubishi Agricultural Machinery in Japan. Both entities have struggled to maintain profitability, prompting M&M to initiate cost-cutting and operational restructuring efforts.

“Beyond the impairments, we’ve begun implementing action plans to reduce costs and losses in these businesses,” Jejurikar said. While specifics of the turnaround strategy remain undisclosed, the company emphasized restoring efficiency and narrowing international losses.

The company holds a 35% stake in the harvester firm Sampo Rosenlew and a 33% stake in Mitsubishi Mahindra Agricultural Machinery. Its global footprint includes operations in North America, Brazil, and Mexico, as well as full ownership of Turkey’s Erkunt Sanayi Traktor and a 75.1% stake in Hisarlar, also in Turkey.

In North America, one of Mahindra’s largest overseas markets, demand continues to lag. The region saw a 13% decline in tractor volumes in 2024–25, marking a third straight year of degrowth. The company attributed the prolonged slump to high interest rates and persistent macroeconomic uncertainty, with recovery dependent on future US Federal Reserve rate cuts.

Despite the downturn, Mahindra is making progress in key segments. Its newly launched OJA tractor series, aimed at the lower horsepower category, has seen its market share grow from 3% to over 10% in the past four months.

“This was previously our weakest segment and one of the reasons we invested in the OJA platform,” Jejurikar said.