Tractor major Tractors and Farm Equipment Ltd (TAFE) is setting up a greenfield manufacturing plant at Manisa in Turkey with an annual capacity 15,000 tractors. TAFE is the world’s second largest manufacturer of tractors in the sub-100 HP range with an annual production and sale of about 80,000 units and close to a million customers.
Though the company officials declined to comment on the exact investment on the Turkey plant, industry sources said that it could be in the range of $20 million to $25 million and the company will cover the Turkey market with its product portfolio, ranging between 25 hp and 80 hp machines.
According to sources, Turkey is a growing market for tractors and will have an annual potential of 50,000 units. Out of the two major manufacturers, one had closed down its operations, which will give TAFE an edge over others and the company hopes to garner a sizeable chunk of the market share there, said the sources.
Commenting on the investment in Turkey, TAFE’s chairman and managing director A Sivasailam said, “Turkey is a strategically important market for us .TAFE has, over the past few years, invested significantly in developing tractors in the sub-100 HP range for a variety of applications for discerning customers in both the domestic and overseas markets. Tractor customers in Turkey are progressive farmers who expect the highest levels of performance, reliability and fuel efficiency and we are confident our products will meet these expectations. We believe that this is the opportune moment to enter with a greenfield plant into Turkey.”
Mallika Srinivasan, director, TAFE, said: “The tractor market in Turkey is of significance to us as its composition is well within our experience and manufacturing range. Over 2,000 TAFE tractors are already in operation in Turkey giving us a good understanding of the market and its needs. Turkey is an investor-friendly country and we have been welcomed and facilitated in our investment proposals by the authorities in Turkey. With this support we expect the first tractors to roll out of the new plant in the first quarter of 2009.”
TAFE already has extensive manufacturing facilities in India with four plants, an engine plant and other plants that manufacture hydraulic pumps, transmissions and engineering plastics and is part of the Amalgamations group which is one of India’s largest light engineering groups with business interests in the automotive components sector. TAFE has an annual capacity of 80,000 tractors and exports contribute 10% to the total sales of the company. TAFE sells 7,000 units in countries like the US, South Asia, Africa.