Report

The Thailand tractor market by shipments is expected to grow at a CAGR of 3.05% from 2024 to 2030.

Impact of Ongoing Tariff Changes on Thailand's Tractor Market

Thailand has recently imposed a 72% tariff on U.S. goods, significantly increasing the cost of American products entering the Thai market. In retaliation, the United States has implemented a reciprocal tariff of approximately 36% on Thai imports. These moves aim to protect national economic interests but have intensified trade tensions between the two countries.

Although the U.S. has announced a temporary pause on further tariff hikes, this suspension is only in place for 90 days. A minimum 10% tariff remains active during this period, leaving the future of trade relations uncertain. This escalating trade conflict has broad implications, particularly for Thailand's agricultural sector, which depends heavily on imported machinery and equipment.

U.S.-based tractor manufacturers such as John Deere, CNH Industrial, and AGCO Corporation play a crucial role in supplying agricultural machinery to Thailand. With the implementation of new tariffs, the cost of importing tractors from these companies is expected to rise sharply. This increase is driven not only by higher duties but also by added shipping complexities and currency fluctuations. As import costs surge, manufacturers and distributors are likely to pass these expenses on to consumers. Consequently, farmers in the Thailand tractor market may face a significant increase in tractor prices, prompting a shift in demand toward locally manufactured equipment or more affordable alternatives, such as hand tractors.

One area poised for growth amid these challenges is the rental tractor market. Farmers and small-scale agricultural operators may increasingly turn to equipment rental as a more cost-effective and flexible solution. This model reduces upfront capital investment and offers a lower financial risk, making it a practical choice during periods of economic uncertainty and trade instability.
However, these developments are expected to place additional financial strain on Thai farmers. Higher equipment costs could delay machinery upgrades and reduce overall investment in modern farming tools. This may impact manufacturers' profit margins and disrupt established supply chains. Moreover, the changing landscape could provide opportunities for other international competitors to enter the market, potentially reshaping global agricultural trade dynamics.

MARKET TRENDS & DRIVERS

Electric and Alternative Fuel Tractors

The Thailand tractor market is undergoing a significant transformation, driven by the rise of electric and alternative fuel tractors. As sustainability goals, rising fuel costs, and government policies promoting clean energy gain momentum, Thai farmers and agribusinesses are increasingly turning to eco-friendly tractor options. In March 2024, Siam Kubota, one of the leading manufacturers of agricultural equipment in Thailand, announced a 1.4 billion baht ($39 million) investment to expand and upgrade its production capabilities. This initiative aims to enhance productivity and promote eco-friendly farming solutions. The company has developed electric tractors, currently utilized on pilot farms, and is exploring alternative energy sources such as nitrogen to address challenges like battery duration and charging infrastructure. By investing in electric tractors and eco-friendly tech, Siam Kubota positions itself as a pioneer in sustainable farming in Southeast Asia.

Government Policy and Credit Support System

Government initiatives and credit support programs are key drivers of growth in the Thailand tractor market. The Thai government actively promotes agricultural mechanization to improve farm productivity, reduce labor dependence, and enhance food security. Policies such as subsidies for machinery purchases, tax incentives, and modernization programs encourage farmers to invest in tractors and other agricultural equipment. In February 2025, BAAC launched two aid programs worth 50 billion baht ($1.41 billion)to support farmers amid low rice prices. A 35-billion-baht loan program helps farmers delay sales, offering up to 300,000 baht ($851.7) per farmer with government-covered interest. A 15-billion-baht ($425.8 million) program supports cooperatives in buying and processing rice, with loans up to 300 million baht ($8.51 million) at 1% interest.

INDUSTRY RESTRAINTS

Competition From Second-Hand & Rental Markets

Competition from the second-hand and rental tractor markets presents a significant challenge in the Thailand tractor market. Many farmers and agricultural businesses opt for more affordable used tractors or rental services instead of purchasing new equipment, thereby reducing the demand for new tractors. This challenge is particularly pronounced among small and medium-sized farms, where budget constraints are critical. As a result, manufacturers and dealers face increasing pressure on sales volumes and pricing strategies, limiting overall industry growth. The refurbished equipment segment, dominated by small and local sellers, holds a major share of the industry. There are several market players from the Thailand industry are also active in selling used tractors in Thailand. For instance, companies such as Chor Danchang Group, Baht&Sold, and All-Biz Ltd and licensors offer a wide range of tractors across various horsepower categories from leading brands.

THAILAND TRACTOR MARKET'S SEGMENTATION INSIGHTS

INSIGHTS BY HORSEPOWER

The below 50 HP segment is the largest in Thailand, holding over 67% share of the Thailand tractor market. This dominance is driven by the country's agricultural structure, which is largely composed of small and medium-sized farms. These farms prefer smaller tractors that are cost-effective, maneuverable, and easier to maintain. As one of the fastest-growing segments, it reflects healthy ongoing demand, fueled by the government's agricultural modernization programs and subsidies encouraging mechanization among smallholder farmers. The rising need for multipurpose tractors for crop cultivation, land preparation, and transportation in rural areas will continue to sustain this segment's growth.

- Below 50 HP
- 50 HP to 100
- Above 100 HP

INSIGHTS BY DRIVE TYPE

In Thailand tractor market, 2WD (Two-Wheel Drive) tractors overwhelmingly dominate the industry share. This dominance is driven by factors like the country's agricultural landscape, where flat terrain and smaller farm sizes make 2WD tractors more practical, efficient, and cost-effective for the majority of farmers. Beyond holding the largest share, 2WD tractors are also the fastest-growing segment in Thailand. Farmers continue to favor 2WD models due to their lower purchase and maintenance costs, better maneuverability for traditional crop farming (especially rice and sugarcane), and sufficient power for most agricultural tasks in Thailand's conditions. Incentives and financing programs tailored for smallholder farmers further boost this trend.

- 2 Wheel Drive
- 4 Wheel Drive

THAILAND TRACTOR MARKET'S GEOGRAPHICAL ANALYSIS

The North Eastern region stands out as the most prominent region in the Thailand tractor market. Known for its vast agricultural lands and rural economy, this region has a strong and consistent demand for tractors to support crop production, especially rice and cassava farming. The steady expansion of mechanized farming practices has further strengthened the industry, making it the most active area in Thailand for tractor usage. Furthermore, despite being highly urbanized, Bangkok exhibits a surprisingly significant share of the Thailand tractor market. Here, the demand is more specialized, driven by landscaping, infrastructure projects, and urban agriculture initiatives. Additionally, the presence of large commercial hubs and easier financing options contribute to an active and growing industry for high-efficiency, compact, and technologically advanced tractors.
The Northern region, with its mountainous terrain and diverse agricultural output - including fruits, coffee, and rice - maintains a healthy demand for tractors. Mechanization is crucial here to manage varied crop types across different landforms. The increasing adoption of modern farming techniques has played a key role in keeping the tractor market dynamic in this region. Furthermore, the Central and Eastern regions in the Thailand tractor market are more industrialized but still maintain pockets of strong agricultural activity. In the Central region, rice farming remains a major driver, while in the Eastern area, fruit cultivation and the proximity to industrial zones create a mixed-use demand for tractors. These regions benefit from better access to technology, maintenance services, and financing facilities, supporting steady market activity.
Although smaller compared to other regions, the Southern and Western areas are seeing a gradual rise in tractor use, particularly for plantation crops like rubber, oil palm, and coconut. Moreover, the Western region's agricultural activities, combined with growing interest in sustainable farming methods, are contributing to a modest but noticeable industry expansion. Efforts to introduce mechanized solutions in areas with difficult terrain are also beginning to open new opportunities.

- Thailand
o Northeastern
o Bangkok
o Northern
o Central
o Eastern
o Southern
o Western

VENDOR LANDSCAPE

The Thailand tractor market is consolidated, and dominated by both global and strong domestic players. The market is characterized by the presence of diversified global and regional vendors. As international players expand their market footprint, regional vendors are estimated to find it increasingly difficult to compete with these global players. Furthermore, players in the Thailand tractor market are increasingly bundling their products with after-sales service, training programs for farmers, and farm mechanization packages (bundled equipment + consultancy), rather than competing solely on price. For instance, Siam Kubota strategically nurtures future agricultural leaders by hosting the KUBOTA Smart Farmer Camp 2023, combining hands-on smart farming innovation with expert-led farm design education. The initiative strengthens Kubota's brand loyalty among youth while promoting sustainable and tech-driven agriculture.

Key Developments in the Thailand Tractor Market

- In 2024, Mahindra & Mahindra is entering the ASEAN market, starting with Thailand, by launching its OJA lightweight tractors tailored to the region's agricultural needs. The company aims to establish a strong presence, expand gradually, and achieve a high single-digit market share within five years.
- In 2023, Kubota offers farmers tax deductions up to 40,000 baht ($1,135.6) through the "Shop Good, Get Cash Back" project. Eligible products include diesel engines, tractors, spare parts, oil, and services. By making purchases more affordable, Kubota can attract new customers - especially smaller farmers or first-time buyers who might otherwise delay or avoid buying a tractor.
- In 20222, CNH Industrial and Monarch Tractor launched the New Holland T4 Electric Power, the first all-electric light utility tractor with autonomous features including remote activation, obstacle detection, and fleet management. Designed for mixed farms, orchards, and municipal use, it delivers 120hp, 440Nm torque, and zero emissions. Its battery lasts a full day, fast-charges in one hour, and doubles as a backup power source.

Key Company Profiles

- AGCO Corporation
- CNH Industrial N.V.
- Deere & Company
- KUBOTA Corporation

Other Prominent Company Profiles

- YANMAR HOLDINGS CO., LTD.
- Changzhou Dongfeng Agricultural Machinery Group Co., Ltd.
- Antonio Carraro
- Action Construction Equipment Ltd.
- CLAAS KGaA mbH
- Deutz-Fahr
- ISEKI & CO., LTD
- BCS S.p.A.
- Talaythong Factory Co., Ltd.
- TAFE
- Jiangsu Yueda Intelligent Agricultural Equipment Co., Ltd
- Ragnar
- PREET GROUP
- Sonalika
- Mahindra & Mahindra

KEY QUESTIONS ANSWERED:

1. How big is the Thailand tractor market?
2. What is the growth rate of the Thailand tractor market?
3. Which region dominates the Thailand tractors market share?
4. What are the significant trends in the Thailand tractor market?
5. Who are the key players in the Thailand tractor market?