» Business » SAS to sell 1,000 tractors @ Rs 99,000

SAS to sell 1,000 tractors @ Rs 99,000

By BS bureau in Hyderabad
December 09, 2004 12:20 IST
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Ghaziabad-based SAS Motors, which launched its low-priced 22-horsepower Angad 240 D tractor in the Andhra Pradesh market, aims at selling at least 1,000 units a month in the state, a target that is more than the total tractor sales in the state at present.

The tractor, which is available with a price tag of Rs 99,000, is likely to create a mini-revolution of sorts in the state in terms of low cost mechanisation of the much ravaged agriculture sector.

SAS Motors, which apart from sourcing the engine and parts from China has also designed the tractor on a Chinese platform to suit the local needs.

The company's managing director, Ravindra Kumar said that the company has now proposed to set up an assembly unit each in Andhra Pradesh and West Bengal.

This is based on the bookings and the response received from the dealers, who are in the process of being appointed in the state.

Currently, SAS Motors has two assembly units -- in Pune and in Ghaziabad -- with a daily capacity of 30 tractors. About 20 per cent of the tractor parts have been indigenously manufactured.

Maintaining that so far his company has made an investment of just over Rs 1.5 crore (15 million), which includes investment on the two assembly facilities, Ravindra Kumar said that he was happy with a profit margin of around 5-7 per cent.

According to him, the dealers will get about Rs 7,000 on each unit. "Volumes will add up to the profitability. And there is a lot of scope as we are creating an entirely new segment for our tractors," he observed.

Once the Angad tractor passes through the mandatory tests in a testing facility of the state agricultural department located in Anantapur, the vehicle will become eligible for financing by the co-operative banks and subsequently for the government subsidy schemes.

SAS Motors launches Rs 99,000 tractor

Claimed to be fuel efficient by more than 25 per cent over the existing tractors of 25 HP range and at half the price of the cheapest tractor available in the Indian market, the Angad tractor is capable of handling all kinds of agriculture operations, he said.

The tractor was launched first in Maharashtra on November 11. According to Kumar, Andhra Pradesh was consciously chosen for the launch of the tractor as the agriculture sector in both the states has been undergoing same crises.

Already 100 tractors have been sold in Maharashtra and all of them are doing very well, he said, adding that the company on hand had a booking of about 6,000 tractors.

"Also the informal support and encouragement from the Andhra Pradesh government made us pre-pone our launch plans as we originally thought of introducing our vehicle only in March 2005 in Andhra Pradesh," Kumar said.

He blamed 'auto lobbies and trade associations' for allegedly resisting the entry of such cheaper versions into the Indian agriculture sector by influencing the government policies at national level.

He said the motive behind launching the tractor in Maharashtra and Andhra Pradesh much before it happened in his native state of Uttar Pradesh, is that the farmers in these states are in need of such an effort to overcome from the present crises.

He confidently says that a farmer can earn from Rs 10,000 to Rs 15,000 a month using the tractor as a multi utility vehicle. Apart from Angad, the company is also introducing a power tiller with all the accessories for around Rs 60,000.

"In the near future, we will introduce a three-wheeled village car that can be utilised for both goods and passenger transportation. It will also cost around Rs 60,000," Kumar said.

The idea of Angad sounds more promising when it comes to its maintenance issues. "We can buy the clutch plate for just Rs 150 whereas the same part for the existing brands will cost about Rs 1,500," Jagadish Reddy, a dealer for the Angad tractor told the media.

"In terms of performance, it ploughs one acre of land in about one hour 20 minutes, whereas a Mahindra tractor ploughs the same area in 50 minutes. However, the latter will consume at least five litres of diesel per hour whereas Angad consumes around 2.7 litres per hour. The result is a saving of about 25 per cent at least on fuel alone," he said.

Reddy has already handed over some Angad tractors to farmers in Pulivendula area for field demonstrations as well as feed back on the performance of the vehicle.

SAS Motors has tied up with a Chinese company, Shandong Shifeng (group) Company, which makes both tractors and other vehicles.

Yuan Lee, business manager of international trade wing of the Chinese company said there they also had a technology tie-up with the Yamaha Motors of Japan.

"We are looking forward to start a joint venture Shandang-Yamaha bike manufacturing plant here in India," he said. An all round revolution in terms of low cost and high performance vehicles seems to be on the anvil.

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BS bureau in Hyderabad

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