Tractor Market Expected to Rise at 3.83% CAGR during 2025-2033

The global tractor market report is projected to grow at a CAGR of 3.83% during the forecast period from 2025 to 2033. This growth is driven primarily by factors such as rising global food demand, expansion of agricultural land, increasing interest in farm mechanization, and ongoing technological advancements.

STUDY ASSUMPTION YEARS

• Base Year: 2024
• Historical Year/Period: 2019-2024
• Forecast Year/Period: 2025-2033

TRACTOR MARKET KEY TAKEAWAYS

• CAGR: 3.83%
• Forecast Period: 2025-2033
• Rising adoption of precision farming and farm mechanization to enhance productivity increases tractor demand.
• Growth in farm training programs promoting large-scale agricultural machinery use accelerates market expansion.
• Building and construction activities boost the demand for tractors in construction.
• Increasing adoption of automated commercial vehicles and wireless connectivity for remote monitoring is shaping the market.
• Asia Pacific dominates the tractor market due to investments in modernizing agriculture and improving productivity.
• Challenges include high initial tractor costs and competition from alternative technologies such as electric vehicles.

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MARKET GROWTH FACTORS

The major drivers of growth are rising global food consumption, expansion in the global arable land, and the increase in farm mechanization. HSBC Global Research expects global food to be consumed at a rate that grows by more than 50% over the next 40 years to 2050 because almost 1 billion more people earn more. Modern tractors help farmers cultivate more land and get better yields driving the segment's growth.

Government subsidies and schemes aid within the tractor industry. In March 2024, the Sri Lankan government declared a 25 million INR package toward the Agricultural Modernization Centres, and an additional 175 million INR went from them to key agricultural departments to modernize agriculture. Such financing would assist the market by making new tractor purchases easier, especially in developing areas.

Technological advancement in tractor innovation is another factor driving the growth of the market. For instance, in August 2024, AutoNxt launched India's first electric tractor presenting growing interest in electric and hybrid tractor technology. The advantages include reduced emissions and fuel use. New technologies such as GPS and automation are attractive to technology oriented farmers, but face competition from alternative technologies.

MARKET SEGMENTATION

By Power Output:

• Below 40 HP: This segment currently holds the majority share globally. Tractors under 40 HP are used chiefly for small-scale farming, landscaping, and utility tasks, favored for their maneuverability, efficiency, and affordability.
• 40 HP - 100 HP: Not explicitly detailed beyond being a category.
• Above 100 HP: Not explicitly detailed beyond being a category.

By Drive Type:

• 2-Wheel Drive: Holds the largest market share. 2WD tractors are popular due to affordability, simplicity, and fuel efficiency, suitable for various agricultural and utility tasks.
• 4-Wheel Drive: Not further detailed beyond being a category.

By Application:

• Agriculture: Dominates the market. Tractors are essential for tasks like plowing, planting, cultivating, harvesting, and livestock management, improving productivity and efficiency.
• Construction: Increasing demand due to rising building projects.
• Mining: Not specifically detailed.
• Forestry: Not specifically detailed.
• Others: Not specifically detailed.

By Region:

• North America (United States, Canada)
• Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, Others)
• Europe (Germany, France, United Kingdom, Italy, Spain, Russia, Others)
• Latin America (Brazil, Mexico, Others)
• Middle East and Africa

REGIONAL INSIGHTS

Asia Pacific continues to hold the largest market share in the global tractor market owing to focused investments on modernization of agriculture and agricultural productivity for food security. Government subsidies, grants, and low-interest loans for tractors along with improved rural infrastructure, including roads and irrigation, contribute to the growth of agricultural machinery and the agricultural tractor market in the region.

RECENT DEVELOPMENTS & NEWS

• August 2024: New Holland (a CNH brand) launched the WORKMASTER 105, a 100+ HP tractor made in India with a 106 horsepower FPT engine, 3,500 kg lift capability, electro-hydraulic 4WD, and air-suspended adjustable seating.
• August 2024: AutoNxt introduced India's first electric tractor at Talao Pali Lake Side, Thane, benefitting farmers and promoting environmental conservation.
• June 2024: Mahindra Tractors launched Mahindra OJA 2121, a lightweight tractor specializing in puddling for crops like paddy, in Madhya Pradesh.

KEY PLAYERS

• Agco Corporation
• Argo Tractors S.p.A
• Changzhou Dongfeng Agricultural Machinery Group Co. Ltd.
• CLAAS KGaA mbH
• CNH Industrial N.V.
• Deere & Company
• Escorts Limited
• Kubota Corporation
• Mahindra & Mahindra Ltd. (Mahindra Group)
• Sonalika Group
• Tractors And Farm Equipment Limited (Amalgamations Group)
• Yanmar Co. Ltd. (Yanmar Holdings Co., Ltd.)

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