Mahindra vs Sonalika: The New Battleground in Global Tractor Markets

12 Jul, 2024

Mahindra Tractors is the world’s largest tractor manufacturer and the top tractor-selling brand in India. This tractor giant now plans to strengthen its presence in the export markets by entering into ASEAN and Western European countries.

However, the road ahead isn’t going to be smooth for Mahindra Tractors as Sonalika, another very famous home-grown tractor brand from India, has a very strong grip in export markets, including ASEAN and Western Europe. It managed to become the number 1 tractor exporter brand from India, empowering farmers of 150+ countries across the globe. It even opened an office in the Netherlands, a prominent tractor market in Western Europe in 2021. 

Mahindra Tractors Strategy for ASEAN and Western European Markets

At first, Mahindra Tractors will debut in the ASEAN market by entering Thailand this year. It plans to explore Western European markets by next year. Through this move, it aims to double its exports in the next three years.

It already has a very strong presence in India, seizing above 40% of the total Indian tractor market. For FY24, the total domestic sales of Mahindra Tractors stood at 3,64,526 units whereas its export was 13,860 units. Mahindra Tractors has state-of-the-art tractor manufacturing units in India, Finland, Brazil, North America, Mexico, Japan, and Tokyo. The company sees a huge growth opportunity in the international markets for the tractors below 110 HP category.

This debut in ASEAN and Western European markets will take place with the help of the OJA tractor range. In fact, this tractor range is designed especially for the international markets. Keeping the same goal in mind, Mahindra launched its OJA series in an event, held in South Africa.

Developed with Japan-based Mitsubishi Mahindra Agriculture Machinery, the OJA tractor range offers sub-compact, compact, small utility, and large utility tractors. This range features tractors within the 20 HP to 70 HP range. 

Sonalika Export v/s Mahindra Export 

Sonalika Tractors is India’s number-one tractor export brand and it has a boisterous international customer base of over 2.75 lakh across 150 countries.

Its export numbers are astonishing as every 3rd tractor that India exports is from Sonalika and is built in its Hoshiarpur India facility. According to Sonalika’s official website, Sonalika accounts for 34.4% market share of India’s total tractor exports and has managed to sell over 35,000 tractor units in the export markets for two years in a row (FY'22 and FY'23). Sonalika already has a 100% presence in all European Countries and a very strong presence in many ASEAN countries and is the first choice for international markets such as Finland, Hungary, Germany, and Portugal.

As Mahindra Tractors plans to enter into ASEAN and Western European countries, it is certainly going to influence the export business of its competitors. Now, this influence will be a mixed bag of certain positive and negative impacts.

Let us help you understand how Mahindra’s debut in ASEAN and Western European countries will impact Sonalika’s exports.

At present, Sonalika is India’s number one export brand. With the entry of Mahindra Tractors (that is two Indian brands), Sonalika will have healthy competition that will encourage the brand to innovate and improve its offering to maintain its already strong market share.

Sonalika already owns a spare parts center in Germany to cater to the needs of the local audience. Through this center, Sonalika is already offering quality after-sales service to European countries. But, Mahindra has a lot of work to do on this part. This helps Sonalika to gain an edge over Mahindra.

Mahindra Tractors will take time to understand the local customers’ needs and optimize its tractor portfolio accordingly. Sonalika has already passed this phase. To compete with the HP range of Mahindra’s OJA tractor series, Sonalika has an extensive product line that includes modern tractor models such as Sonalika 26 (26 HP), Sonalika 50 (50 HP), Sonalika 60 4 Cylinder (60 HP), and many more (acc. to sonalika international website) with distinctive features catering to the needs of European countries.

It’s obvious that when Mahindra Tractors will tap into these markets Sonalika will have certain competition. But, its already-established dealership network and supply chain will help it to maintain its reign in the European markets.

Speaking of Sonalika’s presence in ASEAN countries, it exports tractors to countries such as Vietnam, Phillippines, Indonesia, Myanmar, Malaysia, Cambodia, and Thailand. So, Sonalika has already captured the aimed export market of Mahindra.

Other Tractor Brands Exporting In ASEAN and European Countries 

While Sonalika is the biggest competitor for Mahindra in European markets, many other leading tractor brands are already present in these markets and can make the road to success a bit tough for Mahindra. Have a look at other tractor brands having a presence in these two markets.
 

In Conclusion

Mahindra Tractors has now started focusing on its growth in the export domain by entering into Western European and ASEAN markets. However, it will take some time for Mahinda Tractors to emerge as one of the players in exports because Sonalika already has a very strong presence in international markets, including the Western European & ASEAN markets.

When two leading tractor brands, Mahindra & Sonalika, from India are going to engage in a fistfight, these two markets are surely becoming the new battleground for the global tractor industry. The world awaits who wins the war!

Nonetheless, one thing is sure; international farmers now have a wide range of advanced tractors from two major Indian tractor brands which is a matter of pride.