Betting big on India’s rural market, the country’s largest car maker Maruti Suzuki India plans to increase its penetration in rural areas by more than 20 percent to cover 1.5 lakh villages.
The company’s rural sales had increased by 23 percent to 4,15,380 units in the last fiscal, when it posted its highest ever total sales in a financial year. It had posted total sales of 12,92,415 units in 2014-15, beating its previous best in 2010-11.
“In FY 14-15, we established presence in 1.25 lakh villages. Target going forward will be to enhance presence in 1.5 lakh villages,” said Maruti Suzuki India executive director, marketing & sales, RS Kalsi.
In 2013-14, the company had established its presence in 93,400 villages across the country. “In FY 14-15, our penetration in rural areas stood at 34.5 percent (of total sales) as compared to 32 percent in FY 13-14,” Kalsi said. The company’s rural sales had stood at 3,36,463 units in 2013-14 financial year, he added.
“At the start of the year (FY 14-15), we targeted to sell at least one vehicle in 1.25 lakh villages. We have been able to reach even the smallest of villages; today more than 7 percent of MSI’s sales are coming from villages with less than 200 households,” Kalsi said. Sales in rural areas have been affected by the delayed monsoons and recent unseasonal rains, he said, hoping that things would improve in the coming days. “Barring the current situation, the long term growth story of rural India looks good and promising. As infrastructural jobs reach rural India, the dependency on agriculture may come down,” Kalsi said. With prosperity and growth in income levels in rural areas, car sales will grow and match urban peers, he added. “Again, companies that have invested in the right enablers are likely to benefit most from this growth,” he said.