1. Summary
Kubota Corporation (Head office in Naniwa-ku, Osaka; President Daisuke Hatakake; hereinafter, "Kubota") and Sumitomo Corporation (Head office in Chuo-ku, Tokyo; President and CEO Susumu Kato; hereinafter, "Sumitomo") will establish a joint venture to sell Kubota-made tractors, combines, and rice transplanters in the suburbs of Chennai, Tamil Nadu, India, which represents the world's largest tractor market. Kubota will be the first Japanese agricultural machine manufacturer to enter the Indian market. Combining the technologies and expertise on rice farming machines that Kubota has accumulated in Japan with Sumitomo's abundant business experience, the new sales company will establish the Kubota brand early in the local Indian market while contributing to the improvement of the food production base in the country.

 

2. Background and Purpose for the Establishment of the Joint Venture Company

(1) In India, against the backdrop of high economic growth, needs have been increasing for agricultural machines, mainly in the southern part of the country where large paddy fields are located.

- The size of the local tractor market is 300,000 units per year (in 2007), of which machines

  with 50 horsepower or less account for nearly 90%, and demand for these machines is

  expected to grow in the future.
- The size of the combine market is 60,000 units per year (units in operation), which are

  mainly combines manufactured domestically in India. Users, however, are increasingly

  becoming dissatisfied with the functions, including operability, of these domestic machines.
- Rice transplanters are not presently used in India, because rice is planted 100% by hand at

  present. Nonetheless, due to the lack of labor caused by industrialization, the needs for rice

  transplanters will possibly rise in the future.

(2) In India, paddy fields cover as much as 44 million hectares in area, which is about 26 times as large as the area occupied by paddy fields in Japan. There will therefore be great demand for rice farming machines in the country. The joint venture will initially sell Kubota's excellent lightweight, compact, and water-resistant tractors, combines, and rice transplanters mainly in the southern part of India, and then expand sales to include all the areas in the country, making use of Kubota's product appeal and ability to provide effective solutions.

 

3. About the Joint Venture
Name: Kubota Agricultural Machinery India Private Ltd.
Establishment: December 2008 (planned)
Location: Suburbs of Chennai, Tamil Nadu, India
Capital: 200 million rupees (about 400 million yen)
Investment ratio: 60% by Kubota and 40% by Sumitomo
Business details: Sale of tractors, combines, and rice transplanters in India
Number of employees: 25 (in 2009) (Number of employees dispatched from Japan: four)

 

4. Sales Target
In 2013 (five years from now): About 20 billion yen

 

 

 Kubota's Agricultural Machines to be Released in the Indian Market

        

34 horsepower tractor (used in preparation for rice planting)   34 horsepower tractor (used to till the soil in the field)

 

         

Walking-type rice transplanter                                                  Riding-type rice transplanter 

 

Related Link

• Transportation & Construction Systems Business Unit