History of Swaraj Tractors

Today, Swaraj Tractors is the second largest tractor brand in the country.  It enjoys very high brand recognition and customer connect which is accurately captured in its slogan “Mera Swaraj”.   The Swaraj brand has roots in the Green Revolution in the 1960’s.  In 1965, Govt of India commissioned Central Mechanical Engineering Research Institute (CMERI) to lead the design and development of an indigenous tractor.   This “Swadeshi” 20 hp tractor prototype was ready by 1969.  Punjab Government bought this design in 1970 and set up Punjab Tractors Ltd to manufacture 5000 tractors annually.   The tractor was branded “Swaraj” inspired by Mahatma Gandhi’s idea of Swaraj which means economic freedom.  The first Swaraj model was the 26.5 hp Swaraj 724.  Truly, this first Indian tractor meant freedom from expensive imports for the millions of farmers in India.

Punjab Tractors Ltd (PTL) sold 589 Swaraj tractors in 1975.  By 1978, Swaraj had 3 models in the market. The sales went up to 5984 units in 1983 and 45712 units in 2001.  Swaraj tractors enjoyed a market share at 20% in early years of the century.  Significantly, the revenue of PTL crossed 1000 crore mark in 2001.   Over time, more than 7 tractor models were introduced under the Swaraj brand.

India’s first indigenous Combine Harvester (Model Swaraj 8100) was introduced in 1980 and Industrial forklift trucks were introduced in 1985.  Swaraj Engines Ltd was formed in 1986 to manufacture diesel engines.  1988 marked the roll out of 1 lakh tractors since the beginning of the company.  

The company began operations in Mohali in Punjab.  In 1995, a second facility was commissioned to cater to the growing demand and the expanding product lines.  In 2002, the cumulative tractor sales crossed the 5 lakhs mark.  Swaraj became the fastest growing tractor brand of that time.

Starting early 2000’s the Punjab Government decided to lower its stake in the company.   This led to lack of investments and deterioration of relationships with the labour union.   The market position of the company fell from second to the fifth place.  The share price dropped from Rs 1000 to Rs 250. After a couple of bad years where the profit of the company fell to a low of 80 crores, Mahindra & Mahindra stepped in to acquire majority stake in PTL in 2007.   It was this acquisition that made Mahindra the largest tractor company in the world by volume. 

Mahindra merged the Swaraj brand with their Farm Division which manufactured Mahindra Tractors.  Thus, PTL was delisted and it ceased to exist.  Now Swaraj Tractors are manufactured under the Swaraj division of the Mahindra’s Farm Equipment Sector.  

Mahindra reenergised the operations of Swaraj.  The first task at hand was liquidated excess stock and collected the outstanding balances from the dealers.   In 2008, with basic operations stabilized, the new management started focusing on growth.  The sales channel was revitalized, and new dealerships added.   A series of TV advertisements was launched.   Tie-up with Mahindra Finance proved crucial as more than 80% of the tractors are retail financed.   The Union was also taken along through talks and concrete steps such as salary hikes, better medical benefits, and improved safety and comfort. 

With all these efforts and a growing tractor industry, Swaraj tractors bounced up to its earlier position of the second largest tractor brand in the country.  Today, more than 100,000 Swaraj tractors are sold in India each year and it has a growing presence in neighbouring countries and some markets in Africa.


Comments

K.kalimuthu

Very nice

Surender Kumar

Swraj ltd is best company in agriculture equipment

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