New Delhi, February 13 Japanese multinational farm and construction equipment maker Kubota Corporation plans to make India its growth engine under its mid-term business plan 2030, identifying business and projects from the country as one of the key aspects of the strategy.
Under its 2030 mid-term business plan, Kubota, which operates in India through joint venture Escorts Kubota Ltd, said it will classify its global business into three categories – 'growth driver', 'rebuilding the core' and 'structural reform' – and dynamically reallocate resources to growth areas.
Under the 'growth driver' category, business and projects from India will be one of the pillars, along with the construction machinery business in North America and the lifecycle support business, where there will be selection and concentration of management resources, Kubota said in a presentation.
The company said it aims to turn "India, the world's growth center, into Kubota's growth engine."
"While aiming to capture high-growth markets, we will leverage India as a global hub for R&D, procurement, and production, and improve the cost competitiveness of the entire group and strengthen our supply chain," it said.
Listing out the opportunities in India, Kubota cited strong economic growth with real GDP growth in the first half of fiscal 2025 at 8 per cent and said, "Strong domestic demand supports the business environment."
The world's largest tractor market, with the development of the economy and the increasing mechanisation of agriculture, the Indian market is expected to continue to expand, it added.
As part of the strategy, the company said it will strengthen cost competitiveness and introduce new products under the Kubota brand with excellent cost competitiveness, utilising the R&D, manufacturing, and procurement resources of Escorts Kubota.
To improve quality and productivity, Kubota said it will improve costs and product quality by utilising Escorts Kubota and Kubota's know-how.
Furthermore, productivity will be improved by "introducing the Kubota production system (KPS) and building a foundation for the future development of high-value-added services (data, maintenance)."
The company further said to deepen its presence in the Indian market, it will expand the lineup of each of its three brands – Farmtrac, Powertrac, and Kubota, and reorganize and strengthen sales channels.
Kubota is looking to tap opportunities in the market expansion of basic tractors, which is seeing good traction globally.
"In Europe, demand for basic models is gradually expanding. In Africa, Latin America, and other countries, the rate of agricultural mechanisation is low, and government subsidies and international aid are expected to boost the basic tractor market," the company said.
As part of product restructuring and cost competitiveness plans, Kubota said it will improve cost competitiveness by promoting Global Innovative Tractor (GIT) projects and utilising resources in India.
Moreover, as part of the global supply chain, Kubota said it will make "strategic use of the sourcing network of India" to reduce costs and diversify suppliers.
The company noted that in the European market "the rise of low-cost Indian models is shaking the position in the compact tractor business."
In terms of future investments for growth, Kubota highlighted the new plant in India, along with the expansion of sales of construction machinery in North America.
Escorts Kubota Ltd, which had earlier planned to set up a new plant in Rajasthan but withdrew the plan later, has been allotted a 200-acre land in Uttar Pradesh by the Yamuna Expressway Industrial Development Authority (YEIDA) for setting up a Rs 4,500 crore tractor manufacturing unit.
