Mumbai: Mahindra Yeuda Tractor Co, the 80:20 joint venture (JV) between Mahindra & Mahindra Ltd and China’s Jiangsu Yeuda Yancheng Tractor Manufacturing Co Ltd will set up a new research and development and engine facility in China, Indian largest tractor maker said in a Monday statement.
Mahindra Yeuda has committed $40 million to the new project. Of this, $18 million will be utilized for the engine and R&D facility, while the rest will be used to modernize the tractor plant. China is the world’s second largest tractor market after India.
M&M’s farm and equipment sector had bought a controlling stake in Yeuda Tractor Co in August 2008. Anjanikumar Choudhari, president (farm equipment sector) at M&M, said that the most immediate benefit of the R&D and engine project would be to make engines more fuel efficient. The new facility will make 45,000 to 50,000 engines annually.
The engines, which will be in the 80-90 horsepower range, will also power Mahindra China Tractors, M&M’s first JV with Jiangling Tractor Co, in which it has a controlling stake.