Global Electric Farm Tractor Market Grows Steadily at a CAGR of 10.95%

Introduction

Electric farm tractors are powered by an electric motor instead of a conventional internal combustion engine. Electric farm tractors generate power from a series of batteries and have fewer mechanical components than traditional tractors. The electric farm tractor market's growth is driven by a greater emphasis on clean and sustainable agriculture. Demand for electric farm tractors is driven by the increasing cost of fuel and government initiatives to promote clean technologies. Globally, most farms are subsistence farms owned by small farmers; these farmers are adopting small electric farm tractors for applications with low power requirements. 

In addition, the trend toward the consolidation of small farms and their acquisition by commercial farm owners is increasing demand for the tractor, which is anticipated to increase demand for electric farm tractors. The electric motors' torque is double that of the gasoline motors so that they can pull heavier loads. The 60-horsepower tractor can accomplish the same tasks as the 120-horsepower diesel tractor. Electric tractors are cost-effective and, as a result, reduce the operational expenses of agriculture, thereby increasing yield. Moreover, electric farm tractors produce fewer emissions and require less maintenance than conventional tractors, which is a significant advantage for the electric farm tractor market.

Market Dynamics

Increasing Popularity of Electric tractors and Subsidize Agricultural Loans by Federal and State Governments Drives the Global Market

The demand for electric farm tractors has increased due to the numerous advantages associated with their use, such as lower fuel costs, lower carbon emissions, and increased energy source efficiency. Many farmers are switching from conventional to electric farm tractors to ensure the vehicle's dependability. Moreover, the production of automobiles and the widespread adoption of cutting-edge technologies are two additional factors likely to drive market expansion. These are the factors that are anticipated to have the most significant influence.

The availability of loan programs for farmers encourages farmers to invest in agricultural equipment. In various regions of the world, national governments have initiated various assistance programs for farmers, including loan forgiveness and agricultural mechanization initiatives. The impact of government subsidies on an economy's agricultural sector is significant. For example, the United States Farm Service Agency (FSA) provides guaranteed and direct farm ownership and operating loans to family-sized farmers in the United States who cannot obtain commercial credit from a bank or a farm credit institution. If the borrower chooses, FSA loans may be used to purchase land, livestock, equipment, feed, seed, and supplies. Consequently, the agricultural equipment market has expanded significantly.

Growing Adoption of Precise Farming Creates Tremendous Opportunities

The agriculture industry is under constant pressure to produce agricultural products to meet the needs of a growing population, necessitating that farmers prioritize efficiency and productivity to drive business growth. Precision agriculture is a common choice for farmers wishing to increase their yield with fewer resources. Additionally, by using this technique, farmers can boost both the operational effectiveness of their businesses and production levels, thereby closing the gap between the number of agricultural products that are readily available and the amount that consumers are willing to buy. Precision agriculture technology enables the efficient use of water, seeds, land, fertilizers, and agricultural equipment. As a result, the yield and quality of harvested crops increase.

Regional Analysis

The Asia-Pacific region has held the largest share of the global market for electric farm tractors. This is reflected by the region's geographically dominant position in the market. The agricultural sector constitutes an essential part of India's economy. As a result, tractors are an essential component in completing large-scale operations. In addition, in the region, there is a noticeable rise in the demand for electric farm tractors, which is being done to raise the field's overall productivity.

Key Highlights

• The global electric farm tractor market was valued at USD 132 million in 2021. It is projected to reach USD 336.3 million by 2030, growing at a CAGR of 10.95% during the forecast period (2022–2030).
• Based on application, the market is segmented into light-duty tractors, medium-duty tractors, and heavy-duty tractors. It is anticipated that the market for light-duty vehicles will dominate the global market for electric farm tractors, followed by the market for medium-duty vehicles.
• Based on battery type, the market is divided into lithium-ion batteries, lead-acid batteries, and others. It is anticipated that lead-acid batteries will hold a predominant share of the market for battery types in the global market for electric farm tractors.
• Based on drivetrain technology, the market is segmented into hybrid electric farm tractors, plug-in hybrid electric farm tractors, and battery electric farm tractors. It is expected that hybrid-electric vehicles will dominate the market of electric farm tractors market.
• Due to the rapidly increasing demand for tractors in China and India, Asia-Pacific region has held the largest share of the global market for electric farm tractors.

Competitive Players

1. Alke
2. Cummins Inc.
3. Deere & Company
4. Escorts Limited
5. Fendt
6. Kubota Corporation
7. Motivo Engineering
8. Solectrac Inc.
9. Sonalika
10. Monarch Tractor
11. Yanmar Holdings Co. Ltd.
12. AutoNxt Automation Pvt. Ltd.
13. Celestial
14. Ztractor
15. EcoFactor

Recent Developments

• In August 2022, Meritor, Inc., a top provider of drivetrain, mobility, brake, aftermarket, and electric powertrain solutions for the commercial vehicle and industrial markets has been fully acquired by Cummins Inc. (NYSE: CMI).
• In January 2023, The MK-V, a fully electric, driver-optional, smart tractor produced by Monarch Tractor, announced the expansion of its business to Hyderabad, India. In addition to supporting the worldwide supply chain, Monarch Tractor will embrace the new market opportunity to intensify its R&D activities in the United States.

Segmentation

1. By Type of Tractor
   1. Compact Electric Tractors
   2. Utility Electric Tractors
   3. Row-Crop Electric Tractors
   4. High-Power Electric Tractors
2. By Application
   1. Light-Duty Tractor
   2. Medium-Duty Tractor
   3. Heavy-Duty Tractor
3. By Battery Type
   1. Lithium-Ion batteries
   2. Lead-Acid Batteries
   3. Others
4. By Drivetrain Technology
   1. Hybrid Electric Farm Tractor
   2. Plug-in Hybrid Electric Farm Tractor
   3. Battery Electric Farm Tractor