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M&M cuts tractor production, 3 plants to close twice a week


Farm equipment major Mahindra & Mahindra today said it will undertake tractor production cuts for two days per week at its three plants under a stock rationalisation programme amid slowing demand.

As part of ongoing rationalisation of finished stocks, the company will be observing no production days up to two days per week for the remaining period of March, 2012, M&M said in a filing to the BSE.

The plants where the exercise will be carried out are located at Rudrapur, Nagpur and Jaipur, it added.

"The management does not envisage any material adverse impact on availability of tractors in the market due to adequacy of tractor stocks to serve the market requirements," it said.

It, however, could not be ascertained by how much the production will come down as company officials could not be reached for comments.

The move by the company comes at a time when its tractor sales have been slowing down.

M&M's domestic tractor sales in February was down by 20.91% at 14,341 units, as against 18,134 units in the same month last year. Exports, however, grew by seven% at 975 units during the month.

In the April-February period this fiscal, domestic sales stood at 2,05,810 units, up 12% from the year-ago period. Total total cumulative sales, including exports, for the period grew 13% to 2,18,047 units.