Germany Agricultural Tractor Market - Growth, Trends, COVID-19 Impact, and Forecasts (2023 - 2028)

Germany's agricultural tractor machinery market is projected to register a CAGR of 4.9% during the forecast period.

Key Highlights

• The two-wheel-drive segment accounted for more than 85% of the overall tractor market. The 50-100 HP segment accounted for the largest market share and is expected to grow at a CAGR of 5.04% (by volume) during the forecast period.
• According to the European Agricultural Machinery Association (EAMA), there was an increase of 5% in the pre-registrations of tractors in 2019 compared to the previous year. The sales of the tractors reflected a positive trend. Also, according to The Mechanical Engineering Industry Association (VDMA), in 2019, farmers and other custom operators bought around 570 more agricultural tractors resulting in a 2.6% increase in sales compared to 2018. The sub-50 horsepower compact sector contributed more to the tractor market growth in 2019, selling 730 units. This results in the growth of the market.
• The biggest tractor markets in the European Union are Germany and France. The country generates more than 27% of the agricultural machinery and equipment components manufactured in Europe. Thus, Germany has become one of the leaders in producing agricultural machinery in Europe, which signifies its dominance in the agricultural tractors market. With the availability of advanced technology, coupled with the declining availability of farm labor, the farmers are shifting toward using tractors in agriculture, as they save time and resources, decrease costs, and enhance productivity.
• Market players are also launching web-based applications to connect better with consumers and increase their market penetration. Deutz-Fahr launched the mySAME and myDEUTZ-FAHR apps in Germany in 2019 to provide information on the new products and interact directly with the manufacturers. Owing to the dominance of the country in agricultural technology and the growing sales of tractors, the market is anticipated to grow during the forecast period.

Germany Agricultural Tractor Market Trends

Increasing Agricultural Labour Cost

• Germany is Europe's largest tractor market. The two biggest agricultural tractor markets in Europe - Germany and France, account for almost four agricultural tractors out of 10 registered in Europe. Agriculture tractors accounted for 93% of the overall German tractors market in 2021.
• With approximately 80% share, tractors are Germany's largest segment of agriculture equipment in terms of revenue. In addition, in terms of unit sales, Germany is the largest exporter of tractors across Europe. The number of tractors manufactured in Germany accounts for over two-thirds of the total number of tractors manufactured in Europe.
• The German economy achieved excellent growth in 2021. The growth rate is expected to sustain in 2023, supported by the rising employment rate and a monetary policy stance that will continue to support domestic demand. Consequently, 2022 is expected to witness a healthy increment of 4.5% in real GDP growth.
• The Government of Germany's schemes and initiatives to facilitate credit and improve agriculture-related operations are the major drivers contributing to the growth of the overall value chain in the German agricultural sector.
• Germany spent USD 1.4 billion of its official development assistance (ODA) on agriculture in 2021, making it the prime Organization for Economic Cooperation and Development (OECD) and Development Assistance Committee (DAC) donor to agriculture in real terms.
• Agriculture was one of the strategic priorities of the former Development Minister of Germany, Gerd Muller, who launched 'ONE WORLD - No Hunger,' a special initiative on food and nutrition security as well as rural development in 2014, which will most likely be carried forward in this legislative period (2021-2025) under the new Development Minister Svenja Schulze.

Germany is the largest market in Europe

• Germany is the largest market for agricultural tractors in Europe. The country generates more than 27% of agricultural machinery and equipment components manufactured in Europe. Farmers are increasingly adopting agricultural mechanization as a substitute for manual labor with a more cost-effective, easily available, and more efficient means of agricultural operations.
• As a result, they are shifting toward autonomous tractors to save time and resources, which in turn, is increasing farm productivity and per-acre yield of crops. Thus, Germany has evolved to be one of the leaders in producing agricultural machinery in Europe, which signifies its dominance in the agricultural tractors market.
• In terms of sales, the emphasis is on tractor production at a share of around 40%, with a further focus on the power segment above 120 HP. Due to the booming domestic market, the export ratio in the last few years has been steady at 70-75%.
• Owing to the demand from farmers, there has been an increase in investments in autonomous tractors in the country. For instance, in 2020, Germany-based Amathaon Capital invested in autonomous tractor startup AgXeed to develop and commercialize autonomous agricultural machinery in the country.

Germany Agricultural Tractor Industry Overview

Germany agricultural tractor machinery market is a consolidated market, with the major players holding a significant market share in 2022. Deere & Company, CNH Industrial, Agco Corporation, Kubota GmbH, and Claas KGaA mbH are the major players in the country. The companies are competing to gain a major market share by adopting various business strategies such as product launches, expansion, mergers and acquisitions, and investments in R&D.

Additional Benefits:

• The market estimate (ME) sheet in Excel format
• 3 months of analyst support

This product will be delivered within 2 business days.