Mahindra Cuts Tractor Production At Three Facilities

Indian tractor maker Mahindra and Mahindra’s Farm Equipment Sector has cut production at its tractor plants in Rudrapur, Nagpur and Jaipur following declining demand.

The company has slashed production by a full two days a week until the end of March, effectively stopping production for about six days this month. The implied production level will be 14,000 units this month against 21,000 in February.

Agriculture in India has also slowed sharply. For the quarter ended December 2011, the farm sector slowed to 2.7% against 11% a year ago. Overall Gross Domestic Product growth also fell to 6.1%, below market expectations. Through the current fiscal, interest rates have also risen.

Earlier this month the company reported a 21% decline in tractor sales for the month of February over the same month last year. The company sold 14,341 tractors in the domestic market in February, against 18,134 units in the year-ago period. For the April 2011 to February 2012 period, domestic sales have grown 12%.