GVR Report cover Agricultural Tractors Market Size, Share & Trends Report

Agricultural Tractors Market Size, Share & Trends Analysis Report By Engine Power (Less Than 40 HP, 41 To 100 HP), By Driveline Type (2WD, 4WD), By Region (Asia Pacific, North America), And Segment Forecasts, 2022 - 2030

  • Report ID: GVR-4-68038-429-1
  • Number of Pages: 100
  • Format: Electronic (PDF)
  • Historical Range: 2018 - 2020
  • Industry: Technology

Report Overview

The global agricultural tractors market demand was valued at 2,765.3 thousand units in 2021 and is anticipated to expand at a compound annual growth rate(CAGR) of 6.8% from 2022 to 2030. The surge in demand for compact tractors on small farms and technological advancements, such as integrating telematics with agricultural tractors, are expected to drive market growth over the forecast period. In addition, the rapid adoption of mechanization in the agriculture industry is likely to bode well for the market growth over the next eight years. Furthermore, farm laborers’ migration toward cities creating a shortage of laborers is anticipated to drive the market growth. The outbreak of COVID-19 hampered the product demand owing to the temporary suspension of production and supply chain disruption.

Asia Pacific agricultural tractors market demand, by engine power, 2020 - 2030 (Thousand Units)

However, in H1 2021, the demand for tractors bounced back significantly with double-digit growth in major economies, such as the U.S., Canada, the U.K., Germany, China, and India. Also, strong crop production in these markets, along with the need to replace aging equipment, increased product sales in H1 2021. However, a sudden increase in demand led to lower inventory levels of tractors in H2 2021, a trend expected to continue over the next few quarters of 2022. In 2022, OEMs are presumed to increase the agricultural tractors prices from 4% to 22%, which is anticipated to further slow down the market growth. It is attributed to low inventory levels of tractors experienced by dealers.

Also, OEMs are currently experiencing a shortage of semiconductors coupled with supply chain disruptions and market uncertainty due to the growing COVID-19 cases, which may delay production. Furthermore, a hike in steel and aluminum prices is expected to increase tractors prices, which is further anticipated to hinder market growth over the next few quarters. Favorable government policies are likely to boost market growth over the forecast period. For instance, on September 15, 2021, the U.S. Department of Agriculture (USDA) introduced a Precision Agriculture Loan (PAL) Act to allow farmers and ranchers to avail of loans to purchase precision agriculture equipment.

Similarly, the imposition of The U.K. Agriculture Act 2020 and the Canadian Agricultural Loans Act (CALA) are likely to favor the product demand over the forecast period. Such initiatives are expected to fuel the market growth over the forecast period. Technological advancements in agricultural tractors are also expected to bode well for the market growth over the forecast period. For instance, the rising popularity of autonomous and electric tractors is projected to increase productivity and efficiency in farming.

Key vendors in this space, such as Deere & Company, CLAAS KGaAmbH Escorts Ltd., SOLECTRAC, and Monarch, have commercially launched concepts for their autonomous and electric tractors. For example, in December 2020, MONARCH TRACTOR announced the launch of its electric tractor integrated with autonomous, machine learning, and data analysis features. The launched tractor envisages farmers improving operational efficiency, enhancing labor productivity and safety, and increasing yields.

Engine Power Insights

On the basis of engine power, the global market has been segmented into less than 40 HP, 41 to 100 HP, and more than 100 HP. The less than 40 HP segment accounted for more than 61% market share in terms of volume. The high growth can be attributed to low cost, compact size, and greater convenience offered by less than 40HP tractors to perform all basic farming operations. These equipment are adopted mainly in the Asia Pacific region, where approximately 85% of farmlands are below 10 hectares and are preferred by most farmers in the region. In addition, the electrification of tractors in the less than 40 HP segment is expected to gain momentum over the next few years.

The 40 HP to 100 HP segment is expected to register a significant CAGR during the forecast period. It is credited to a surge in demand for these tractors from developed markets, such as the U.S, Japan, and Germany. Increased income levels, tech-savvy farmers, and well-established after-sales services are expected to favor the growth of this segment over the forecast period. The rising demand for high-power tractors for more than 10-hectare farm sizes is expected to be a long-term factor, which is expected to drive the segment over the forecast period.

Driveline Insights

On the basis of driveline type, the global market has been bifurcated into 2-Wheel Drive (WD) and 4WD. The 2WD segment accounted for more than 79.5% market share in terms of volume. The segment is also estimated to register the fastest growth rate over the forecast period. Low upfront costs and better maneuverability are long-term factors that are expected to drive the demand in the 2WD segment, notably in the Asia Pacific market. The 2WDs are the most preferred tractors among middle-income farmers in India.

Global agricultural tractors market demand, by driveline type, 2021 (%)

However, a hike in diesel prices has already increased the operation cost of farmers, which is expected to be one of the serious concerns over the forecast period. Currently, India outsources semiconductor chips and devices for the automobile and other sectors. Therefore, to overcome the semiconductor shortage in the country, the government announced a USD 10 billion package to incentivize companies to set up production units in India. The policy aims to promote semiconductor chip manufacturing and refining, which is likely to further boost the indigenous local production of components for the next few years.

Regional Insights

Asia Pacific led the global market with a volume share of more than 73.5% in 2021 and is estimated to grow further at the fastest CAGR over the forecast period retaining the dominant position. The market is driven by India, followed by China and the rest of Asia Pacific. India led the APAC regional market accounting for more than 40% share in 2021. In India, product sales are expected to reach over 900 thousand units by 2022. Easy loan availability, favorable Minimum Support Price (MSP), and better monsoon are expected to bode well for the regional market growth in 2022.

Europe is expected to grow at a moderate growth rate in terms of volume over the next few quarters in 2022. The growth is attributed to the increased demand for large farm tractors, particularly from Italy, Greece, and Lithuania. In addition, the high demand for autonomous tractors is expected to drive the regional market growth over the forecast period. On the other hand, a long waiting period for new tractor purchases due to production delays is expected to hamper the market growth over the forecast period.

Key Companies & Market Share Insights

Lack of skilled employees, high raw material prices, and shortage of semiconductor components are short-term challenges that are faced by the OEMs. Moreover, due to low inventory levels, OEMs and dealers cannot meet consumer demand. However, strategic initiatives, such as collaborations and innovations, are expected to counter such bottlenecks over the next few years. For instance, in November 2021, CNH Industrial N.V. signed a long-term agreement with Monarch Tractor, an AgTech company, to develop fully electrified autonomous tractors. The initiative would enable the former company to increase its product portfolio.

Furthermore, the growing popularity of autonomous tractors prompted OEMs to adopt an inorganic growth approach to increase market presence. OEMs are emphasizing mergers & acquisitions and collaborations to strengthen their market footprint. For instance, in August 2021, Deere and Company acquired Bear Flag Robotics, an AgTech company, for USD 250 million. It would help the former company to meet the consumer demands and increase its customer base. Some prominent players in the global agricultural tractors market include:

  • AGCO Corp.

  • CNH Industrial N.V.

  • Deere & Company

  • CLAAS KGaAmbH

  • Escorts Ltd.

  • International Tractors Ltd.

  • YanmarCo., Ltd.

  • KubotaCorp.

  • Mahindra & Mahindra Ltd.

  • Tractors and Farm Equipment Ltd.

Agricultural Tractors Market Report Scope

Report Attribute

Details

Market demand value in 2022

2,943 thousand units

Volume forecast in 2030

4,968 thousand units

Volume growth rate

CAGR of 6.8% from 2022 to 2030

Base year for estimation

2021

Historical data

2018 - 2020

Forecast period

2022 - 2030

Quantitative units

Volume in thousand units and CAGR from 2022 to 2030

Report coverage

Volume forecast, competitive landscape, growth factors, and trends

Segments covered

Engine power, driveline type, region

Regional scope

North America; Europe; Asia Pacific; Latin America; Middle East & Africa

Country scope

U.S.; Canada; U.K.; Germany; France; Italy; Spain; Ukraine; Romania; Poland; Benelux; Turkey; China, India; Japan; Australia; South Korea; Brazil; Argentina; Mexico

Company Profiled

AGCO Corp.; CLAAS KGaAmbH; CNH Industrial N.V.; Deere & Company; Escorts Ltd.;International Tractors Ltd/;Kubota Corp.; Mahindra & Mahindra Ltd.; Tractors and Farm Equipment Ltd.;YanmarCo., Ltd.

Customization scope

Free report customization (equivalent up to 8 analysts working days) with purchase. Addition or alteration to country, regional, and segment scope

Pricing and purchase options

Avail customized purchase options to meet your exact research needs. Explore purchase options


Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends in each of the sub-segments from 2018 to 2030. For the purpose of this study, Grand View Research has segmented theglobal agricultural tractors market report based onengine power, driveline type, and region:

  • Engine Power Outlook (Volume, Thousand Units, 2018 - 2030)

    • Less than 40 HP

    • 41 to 100 HP

    • More than 100 HP

  • Driveline Type Outlook (Volume, Thousand Units, 2018 - 2030)

    • 2WD

    • 4WD

  • Regional Outlook (Volume, Thousand Units, 2018 - 2030)

    • North America

      • U.S.

      • Canada

    • Europe

      • U.K.

      • Germany

      • France

      • Italy

      • Spain

      • Ukraine

      • Romania

      • Poland

      • Benelux

      • Turkey

      • Rest of Europe

    • Asia Pacific

      • China

      • India

      • Japan

      • Australia

      • South Korea

      • Rest of Asia Pacific

    • Latin America

      • Brazil

      • Mexico

      • Rest of Latin America

    • Middle East & Africa

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