Mahindra and Mahindra (M&M) is recalibrating its overseas strategy in tractors and farm equipment because of headwinds in the US and European markets.

The company is trying to ascertain whether the weak markets are due to structural changes or seasonal headwinds even as it prepares to launch the OJA-platform-based tractor in the US.

In Japan, it continues to face dwindling sales of its farm sector products.

M&M finance head Amarjyoti Barua said: "There are two types of farm markets that we are experiencing. One that is facing temporary disruptions because of a higher interest rate environment or other macro-economic factors that are creating blips.

"The other is structural declines in European markets. We are looking at our farm international strategy."

He pointed out the company had posted a growth of 11 per cent in revenue in the farm segment despite facing declining markets abroad.

Mahindra's auto and farm head Rajesh Jejurikar said: "In the US, we have a stable market share now but the tractor category has degrown over the last 12 quarters. Our market share is about 50-60 per cent of what it was two years back.

"In January this year, we have seen an uptick. We are on a wait-and-watch policy over Fed interest rates while we prepare to launch the OJA tractor there under a different brand name."

The Japanese market is affected by demographics. Jejurikar said: "The category has been on a decline for a long time. The average age of the farmer there is 65 years. Japan is facing a labour on-farm problem. Our market share is stable but the industry is on a decline. We are number four there and we sell tractors, rice planters and harvesters."

Jejurikar remained optimistic about the US market bouncing back. "We do not expect tractors to sell now during the winter months. However, from March onwards, we should see an uptick in demand."

The company is also focussing on the South African market, where it is among the top 10 auto brands.

Mahindra is launching its subcompact SUV, the 3XO, in South Africa and is diverting much of its production to the country.

"We have a capacity of 9,000 units per month for 3XO. Much of this last month has been directed to the South African market," Jejurikar said.

The company is also preparing to start booking of its EVs — BE 6 and XEV 9e — from February 14.

"About 250 plus dealerships will open up for bookings for the EVs. We have upgraded the infrastructure of our dealerships, we have hired 500 plus people with experience of tech luxury brand and the dealerships have also onboarded 700 people," said Jejurikar.

The company said its EVs will be under contract manufacturing by the parent company and will be sold to its electric arm Mahindra Electric Automobile.

"This is to take advantage of manufacturing synergies of the company as our EVs will be built at our existing Chakan facility using the existing paint and body shop work while battery packing will be done in a new facility on the outskirts of the plant."