Yanmar partnering with Sonalika ITL to build next-generation tractor

Japanese farm equipment manufacturer Yanmar Holdings Co. is partnering with major Indian tractor maker International Tractors Ltd. to develop “next generation tractors” for the global market.

International Tractors Executive Director Raman Mittal said that the two partners “have produced five advanced tractors since the start of full-fledged collaboration” after Yanmar more than doubled its stake in the Indian firm in March this year. The new tractors are equipped with engines complying with future emission standards.

ITL will be producing more tractors in the coming months at its Hoshiarpur plant in the northern Indian state of Punjab.

“We are currently in the process to jointly develop next generation tractors for markets like the United States, Europe and Thailand by leveraging our mutual strengths,” Mittal said.

Yanmar first invested in the Indian firm, which manufactures tractors under the Sonalika and Solis brands, in 2005, and has since provided it with technical guidance.

In an effort to forge a long-term association with ITL, the Osaka-based company raised its stake in ITL to 30 percent from 12.5 percent through a share purchase from U.S. investment fund Blackstone Group L.P.

Mittal said that Yanmar has also shared human resources at the Hoshiarpur plant for the joint project. “Our Japanese partner has increased its involvement and deployed around 15 senior staff for our global production.”

These moves are “an integral part of the growth strategy for Yanmar,” Naoki Kobayashi, a member of the Yanmar board and head of the firm’s India agribusiness, said in a statement released earlier this year.

ITL has invested over 8 billion rupees (about ¥14 billion) to build an integrated tractor manufacturing unit at the plant, which as its global production base is capable of producing 300,000 units annually ranging from 20- to 120-horsepower tractors.

Mittal also said that his firm will further invest around 500 million rupees per year in the plant for a technological upgrade in the next five to seven years.

ITL exports its products to more than 80 countries. It posted its highest ever sales of more than 50,000 tractors in India and abroad in total in the first six months of the current business year that began in April.