History of Swaraj Tractors

Swaraj Tractors is the second-largest tractor brand in the country in today’s time.  As it enjoys a high brand recognition and customer connect which is precisely captured in it’s slogan “Mera Swaraj”.   The Swaraj brand has it’s origins in the Green Revolution of the 1960s.  In 1965, the Indian Government commissioned the “Central Mechanical Engineering Research Institute (CMERI)” to pave new pathways for the design and development of an indigenous tractor.  This “Swadeshi 20 hp tractor prototype” was completed by the year 1969.  Punjab Government purchased this design in 1970 and set up Punjab Tractors Ltd to manufacture at least 5000 tractors on an annual basis.  The tractor was named “Swaraj” and was inspired by Mahatma Gandhi’s idea of Swaraj which means freedom.  The first model of Swaraj is known by the name of “26.5 hp Swaraj 724”.  In every way, this first Indian tractor meant freedom from the costly imports for a large number of Indian farmers.

Punjab Tractors Ltd (PTL)

 

Punjab Tractors Ltd (PTL) sold a total of 589 Swaraj tractors in the year 1975.  By 1978, Swaraj had 3 lucrative models in the market. The sales increased to 5984 units in the year of 1983 and up to 45712 units in 2001.  Swaraj tractors started enjoying a market share at 20% in the early years.  Significantly, the revenue amount of PTL crossed Rs.1000 crores in 2001.  With the advent of time, more than 7 tractor models were launched under the Swaraj brand.

India’s first and foremost indigenous Combine Harvester (Model Swaraj 8100) was revealed to the world in 1980 and Industrial forklift trucks were launched in 1985. Swaraj Engines Ltd was formed in 1986 to begin the manufacturing of diesel engines.

The company began operations in full force in the area of Mohali in Punjab. In the year of 1995, a second facility was commissioned to adhere to the growing demand and the increasing product lines.  In 2002, the total sales of tractors crossed the 5 lakhs mark.

Swaraj Tractors came to be known as the fastest growing tractor brand of that time. 

Starting in the early 2000s the Punjab Government decided to lower its stake in the company.  This resulted in a severe lack of investments and deterioration of relationships with the labor union.  The market position of the company dropped from second place to fifth place.  The share price fell from Rs.1000 to Rs.250. After some bad years where the profit of the company dropped to as low as Rs.80 crores, “Mahindra & Mahindra” ventured in, to own a majority stake in PTL in 2007.   It was because of this acquisition Mahindra became the largest tractor company in the world by a big margin.

Mahindra combined the Swaraj brand with their Farm Division which manufactured “Mahindra Tractors”.  Thus, PTL was completely delisted.  In the present day “Swaraj Tractors” are manufactured under the “Swaraj division”.

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

With the growing tractor industry, Swaraj tractors gained it’s earlier position as the second-largest tractor brand in the country.  In the present day, more than 100,000 Swaraj tractors are being sold in India each year and it has a major growing presence in neighboring countries and some markets of Africa.

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