Chattanooga Tractor and Equipment Co. is getting ready to do some heavy pulling.
The 38-year-old dealer has agreed to become the assembler and distributor of Mahindra tractors for the Eastern United States and Canada.
"We've actually started some assembly," said Randy Topping, Chattanooga Tractor's president. "I've probably got a 150 tractors on the yard now."
The company plans to build inventory to 500 to 700 tractors, he said.
"We'll be shipping on a low month 100 tractors to dealers. That will increase to 700 to 900 a month when business recovers," said Mr. Topping, noting the industry is in a slow time like much of the rest of the economy.
Chattanooga Tractor late last year took over assembly and distribution when Mahindra officials decided to close a Calhoun, Ga., operation and let the dealer handle the operation.
Mr. Topping said his company is investing about $650,000 in the first phase to add onto and retrofit his Polymer Drive facility. When demand increases, the company will likely have to double what is doing now, he said.
The business has hired five people and could bring on up to 40 more in three years, Mr. Topping said.
India-based Mahindra has grown market share by "leaps and bounds," he said.
Mike Hilderbrand, vice president of marketing and organizational development for Mahindra USA, said its primary goal was to ensure a smooth transition as the Chattanooga distribution point is brought online.
Product availability and service levels its dealers expect will continue unaffected, he said.
Mr. Topping said Chattanooga Tractor is making use of its entire six-acre site.
"That's our real challenge," he said. "We'll be challenged to house and store enough product to build it and get it out in a timely manner."
ABOUT MAHINDRA
One of the top three tractor manufacturers in the world, it is part of the Mahindra and Mahindra group based in Mumbai, India, which has annual revenues of about $6.3 billion.
BY THE NUMBERS
* $650,000 -- initial investment
* 40 -- job growth over three years
* 15,000 -- expansion so far by square feet
GONE GLOBAL
Key foreign investments in the Chattanooga area:
* Sanofi-Aventis -- French company is buying Chattanooga-based Chattem for $1.9 billion.
* Volkswagen -- German automaker is building $1 billion plant in Chattanooga.
* Wacker Chemical -- German company that plans a $1 billion plant in Bradley County
* Alstom Power -- French company carrying out a $280 million expansion in Chattanooga.
* Gestamp Corp. -- Spanish firm building a $90 million plant in Chattanooga.
* IVC Corp. -- Belgian company is constructing a $70 million plant in Dalton, Ga.
* SIAG Corp. -- German firm bought Aerisyn LLC, a wind tower maker
* Madem SA -- Maker of wooden reels from Brazil with Chattanooga operation
* T-Mobile -- German telecommunications company has a $16 million center in Chattanooga
* Sofix -- Japanese firm with a plant at Centre South Riverport
* NA Industries -- Another Japanese firm at the Riverport
* Komatsu -- Japanese heavy equipment maker with a plant on Signal Mountain Road
* Aldi -- Germany-based supermarket chain
Sources: Tennessee Department of Economic and Community Development, Chattanooga Area Chamber of Commerce, Dalton-Whitfield County Chamber of Commerce