Domestic tractor sales volume declined by 13.0 percent during FY15 due to unfavorable factors which include delayed and deficient monsoons, decline in kharif output, softening commodity prices. Domestic tractor volumes which remained supported in H1FY15 aided by wholesale push to some extent, witnessed a slump of 22 percent YoY in Q3FY15 and 30 percent YoY in Q4FY15 in absence of any pickup in demand with farm sentiments being negatively impacted owing to dip in farm incomes.
High irrigation penetration in Northern India limited the volume decline during FY15. The eastern and western markets registered 10 percent and 4 percent decline respectively during FY15. The South, however, de-grew only by moderate 7 percent during FY15 mainly because of the relatively better monsoons in Karnataka which saw volumes grow by 10 percent during FY15 even as Andhra Pradesh and Tamil Nadu saw declines of 16 percent and 18 percent respectively during the same period as a result of sombre demand sentiment The tractor industry has projected a growth of nearly 10 per cent this year after the sales had slipped by 10 per cent during 2015 . The domestic tractor industry had clocked sales of under 5,00,000 units in 2015 due to drought and consequent fall in demand in the farm sector.