India, 2 July 2024: DEUTZ is adding another cornerstone to its ‘Dual+’ strategy, which includes both the further development of alternative drive systems and the expansion of the internal combustion engine business. The cooperation with Indian agricultural group TAFE Motors and Tractors Limited announced today allows DEUTZ to expand its business in India, tapping into one of the fastest growing markets worldwide. TAFE Motors is the subsidiary of TAFE – the third largest tractor manufacturer in the world. In 2023, the Indian economy has grown by around 6 to 7 per cent and it is expected that India’s GDP will quadruple until 2050.

Picture - DEUTZ inks cooperation with TAFE Motors, India’s leading agricultural group

The agricultural and construction sector will play a major role in achieving this strong growth. As the beginning of a long-term cooperation, TAFE Motors will manufacture for Deutz up to 30,000 engines in 2.2L (50-75 hp) and 2.9 L (75-100 hp) to augment and complement the wide range of engines made by the Group across emission standards. TAFE Motors will produce engines to suit newer applications in the Indian market as well as for Deutz’s requirement. The engines will be produced in TAFE’ Motors’ world class manufacturing facility at Alwar, Rajasthan in India.

DEUTZ will use the Indian manufacturing base to promote the remaining engines in neighboring markets (esp. APAC), benefitting from cost advantages in production and logistics.

“The strategic cooperation with TAFE Motors secures DEUTZ access and long-term prospects in growing markets with great potential for our smaller combustion engines,” explains DEUTZ CEO, Dr. Sebastian C. Schulte. “It also enables us to continue producing at competitive costs in the future and makes us less dependent on the existing supplier landscape, which is becoming increasingly challenging due to the technological shift and geopolitics”.

The cooperation gives DEUTZ the opportunity to expand its supplier base to ensure efficient and resilient production. It will also reduce its dependence on supply chains in geopolitically tense regions – without sacrificing the corresponding cost benefits. This benefits particularly DEUTZ’s German production sites.

Speaking on behalf of TAFE Motors, Sandeep Sinha, CEO of TAFE Motors said, “This strategic cooperation between TAFE Motors and Deutz will be mutually beneficial, as it will offer access to shared resources and technologies to produce engines that complement TAFE Motors’ and the Group’s existing range to meet the demand for both domestic and international markets. This cooperation will also offer to Deutz the access to high quality engines at best cost for new applications in Indian and relevant overseas markets”.

Both parties are exploring opportunities to expand the cooperation to green drives.

By Sujata