The Indian tractor industry has scripted a historic chapter, closing the calendar year 2025 on an unprecedented high. For the first time ever, annual domestic sales volumes surged past the landmark figure of one million units, signaling a robust upswing in the agricultural machinery sector.
Record-Breaking Numbers and Growth Drivers
According to the latest data released by the Tractor & Mechanisation Association (TMA), total domestic tractor sales reached an impressive 10.9 lakh units (1.09 million) in 2025. This represents a substantial leap from the 9.1 lakh units sold in 2024, translating to a powerful double-digit growth of 20%.
Narinder Mittal, President & Managing Director of CNH India, attributed this record performance to a confluence of positive factors. He highlighted that higher farm incomes and improved farmer confidence acted as primary catalysts. A series of supportive conditions, including good monsoons, better crop outcomes, and easier access to finance, enhanced affordability and accelerated purchasing decisions. A significant reduction in the Goods and Services Tax (GST) rate to 5%, effective from October 2025, further fueled demand by making tractors more accessible. This policy change led to price reductions, offering savings between approximately Rs 40,000 to Rs 1,00,000 across various horsepower segments.
The demand was broad-based, sustained by a healthy mix of replacement purchases and first-time buyers, ensuring strength across all geographical regions and horsepower categories.
Exports Rebound and Production Peaks
The industry's success story was not confined to the domestic market. After a period of subdued performance, exports staged a strong comeback, crossing the one-lakh-unit milestone (1.05 lakh units) in 2025 after a two-year gap. This marks a recovery from the 97,745 units exported in 2024.
The combined momentum from vigorous domestic growth and improved overseas shipments propelled total tractor production to a historic peak. In 2025, manufacturers produced 11.5 lakh units, a significant increase from the 9.82 lakh units produced in the previous year.
Anand Mahindra, Chairman of the Mahindra Group, celebrated this achievement in his New Year note, stating, "Our farm equipment business achieved its highest-ever quarterly market share, proving that innovation on the ground transforms lives."
Monthly Performance and Future Outlook
The closing month of the year, December 2025, saw domestic sales of 69,890 units. While this was lower than the 92,742 units sold in November 2025, it still represented a strong year-on-year growth compared to the 50,993 units sold in December 2024.
Looking forward, the industry is gearing up for a significant regulatory shift. The transition to stricter TREM V emission norms, scheduled to take effect from April 1, 2026, is expected to influence near-term demand dynamics. Rating agency ICRA anticipates a phase of pre-buying activity by both customers and dealers ahead of the implementation. This strategic purchasing is likely to provide a temporary but noticeable boost to tractor sales volumes over the next few quarters, setting the stage for another dynamic period in the industry's evolution.
