Escorts Kubota plans to begin construction of a new tractor manufacturing facility near Jewar airport in Uttar Pradesh early in the next fiscal year, with an initial capacity of 60,000 tractors and scope to expand production to one lakh units.
The greenfield facility is expected to take about two to two-and-a-half years to complete, Escorts Kubota Chief Financial Officer Bharat Madan told PTI. The project will add capacity as the company’s existing tractor operations are running at around 80-85 per cent average utilisation, with utilisation reaching nearly 90 per cent during the high-season quarter.
“I think in the next year we are starting the commercial construction of the greenfield facility which will be for another 60,000 tractors in phase one and we hope to complete that in the next 2 to 2.5 years,” Madan said.
The location near Jewar airport places the proposed plant within one of Uttar Pradesh’s expanding industrial and transport-oriented development zones. The announcement does not disclose the project’s investment value, land area, workforce requirement, construction contractor or the specific production start date.
The capacity addition comes as the company reports mixed performance across its businesses. While demand for tractors has faced near-term pressure, Escorts Kubota said its construction equipment and other farm mechanisation operations have grown. Construction equipment volumes increased 53 per cent during the September quarter, according to Madan.
The company’s harvesters and transplanters business recorded growth of 20-30 per cent, while its engine business registered double-digit growth during the year. Madan said businesses other than tractors, including construction equipment, had performed strongly and were expected to continue doing well.
The proposed plant is also being planned against a weaker immediate outlook for tractor demand. Madan attributed the pressure to uneven monsoon conditions, the El Niño effect and elevated input costs. He said water scarcity in several paddy-growing states, including Telangana, Karnataka and Maharashtra, was affecting demand prospects. Jharkhand and Chhattisgarh were also expected to remain under pressure.
Madan said tractor demand could begin recovering from the second quarter of the next fiscal year, covering July to September 2027, if the monsoon is normal. He also expects the company’s financial performance to start recovering from the fourth quarter, with margins returning to normal levels next year.
The plant will therefore serve both as a response to current production utilisation and as a longer-term capacity decision. The first phase is planned for 60,000 tractors, while the eventual one-lakh-unit potential gives the project a larger scale than the initial build-out. The company has not yet announced further details on the expansion trigger or the administrative approvals required for construction.
Escorts Kubota’s next stated milestone is the start of commercial construction early in the next fiscal year. Completion of the facility is expected within approximately two to two-and-a-half years after construction begins.
