TAFE to Invest ₹1,250 Crore in Fifth Tractor Plant as Exports Drive Growth

Tractors and Farm Equipment Ltd (TAFE), India’s second-largest tractor manufacturer, is preparing to expand its manufacturing footprint with a new plant in north India.

The company plans to invest up to ₹1,250 crore in the facility, which will have an annual production capacity of around 60,000 tractors. The location is yet to be finalised, but the plant is expected to become operational within about 18 months.

The investment marks TAFE’s first greenfield manufacturing facility in nearly three decades and comes after a strong year of growth for the company.

TAFE Expands Capacity After Strong Sales

TAFE currently has four manufacturing plants with a combined production capacity of around 260,000 tractors annually.

The existing facilities are located in Chennai, Doddaballapur near Bengaluru, Kalladipatti near Madurai and Bhopal. The Bhopal facility was added following TAFE’s acquisition of Eicher’s tractor business in 2005.

TAFE chairperson and managing director Mallika Srinivasan said the company is confident about continued growth in both domestic and international markets.

The company sold around 214,000 tractors during the previous year, while revenue across TAFE and its subsidiaries rose to nearly ₹16,000 crore.

Export Demand Becomes a Key Growth Driver

TAFE’s latest investment is not focused only on meeting demand from Indian farmers. The company is increasingly looking towards international markets as an important source of future growth.

The planned northern facility is expected to strengthen TAFE’s presence in the region while providing additional capacity for both domestic sales and exports.

The company expects the new plant to support its expansion as demand for its tractors continues to increase.

TAFE’s Manufacturing Network

TAFE’s flagship manufacturing facility in Chennai was established in 1961. The company later added plants at Doddaballapur in 1981 and Kalladipatti in 1997.

Its Bhopal facility became part of the group through the acquisition of Eicher’s tractor business in 2005.

The group also has a manufacturing presence in Rajasthan. Through its subsidiary TAFE Motors, the company has partnered with German engine manufacturer DEUTZ AG to produce up to 30,000 diesel and internal-combustion engines annually at its Alwar facility.

₹1,250 Crore Investment Signals Confidence

The decision to add 60,000 tractors of annual capacity comes after a strong period for TAFE.

Mallika Srinivasan said domestic tractor sales grew by around 24.8% during the previous year, reaching approximately 214,000 units. Group revenue also moved closer to ₹16,000 crore, including businesses such as plastics and engineering plastics that supply components to the automotive sector.

With the new plant, TAFE is betting on sustained demand in India as well as stronger international sales. Once operational, the facility will increase the company’s manufacturing capacity and strengthen its position in the highly competitive Indian tractor market.