TI Clean Mobility (TICMPL) is planning to launch at least three electric tractors during this fiscal as the electric vehicle arm of Murugappa Group’s engineering company Tube Investments of India (TII) believes that the tractor segment is ripe for disruption due to favourable cost economics in battery-powered products.
TICMPL will focus on what it calls “the productive end of the EV spectrum—three wheelers, tractors and medium and heavy commercial vehicles,” where there are tangible and economic benefits for the customers/owners.
In the electric three-wheeler segment, the company has already launched a battery-powered passenger autorickshaw ‘Montra’ across the southern regions.
According to the company, since cost economics are the same for both electric three-wheelers and electric tractors, it is betting big on e-tractors after three-wheelers.
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“We foresee a huge opportunity for tractors in the country due to supportive government policies for farm mechanisation and green energy programmes,” MAM Arunachalam (Arun Murugappan), Executive Chairman of ₹7236-crore TII said in the company’s latest annual report.
Tractors in India are majorly powered by diesel engines which are an increasing source of carbon emissions and criteria pollutants.
Electric tractors can play an essential role towards green farming, benefitting both the farmer and the environment.
According to the company, e-tractors can prevent the release of carbon dioxide, the main cause of air pollution and climate change.
The acquisition of Hyderabad-based Cellestial E-Mobility has enabled TII to design and build e-tractors from a ground-up architecture, leveraging the company’s frugal engineering and application expertise.
“In tractors, we have plans to introduce 3 different variants in four-wheel drives for different user segments. Work on the production facilities for the tractor is underway at Apex Park in Chennai, Tamil Nadu, with the vehicles slated for launch in this fiscal,” said Mukesh Ahuja, Managing Director of TII.
Its upcoming e-tractor is being designed as a cost-effective, pollution-free, and maintenance as well as noise-free product which will run on swappable, rechargeable batteries that can be charged within two hours from a domestic power source and can be driven for 6 hours before needing a recharge.
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“Even though electric tractors require much higher purchase costs, the TCO analysis shows that the cost gap over a ten-year period is minor even when electricity costs and opportunity costs are assumed to be at the upper bound. Thus, electric tractors could be very cost-competitive if some incentives can be provided,” according to a document (October 2022) of the International Council on Clean Transportation.
The 10-year TCO of the electric tractor was about ₹31.1 lakh while that of the diesel version is less than ₹30.2 lakh. Fuel cost is the major component of both the varieties, followed by vehicle purchase and financing costs.
However, the cost gap between electric and diesel tractors can be bridged with consistent incentives provided for EVs, including the FAME II scheme, State-level incentives, 5 per cent GST, and discounted insurance. With these sops, e-tractors can reach cost parity with diesel models, or even be less expensive on a TCO basis, it stated.
The document clarified that its TCO estimate for electric tractors was conservative due to limitations in data availability and understanding of real-world tractor performance.
According to estimates, the global electric tractor market was worth more than $120 million in 2021. It is expected to reach $300 million by 2030 with a compound annual growth rate (CAGR) of 13.1 per cent between 2022 and 2030.