Rural Markets act as magnets for the Auto Giants

Indian auto market has shown an accelerating growth. The automakers are now looking forward to invest in the rural auto market seeing the exceptional growth prospects. The biggies in the auto industry such as Hindustan Motors, Hyundai Motor India and General Motors are focusing to the capture a major share in the rural market. However, Maruti Suzuki is planning to venture with ITC's e-Choupal and also with the Hariyali Bazzar of DCM Shriram Group for a better grip in the rural auto sector.

General Motors India, has grown from 20 per cent in 2009 to 30 per cent in 2010 in its sales in rural market.

P Balendran, the vice president of GM India said, in 2010's first three quarter, the company sold 93,960 vehicles over 63,000 vehicles last year during the same period, which accounts to a growth of 73 per cent. He added with enthusiasm, that in the last quarter, the sale is expected to exceed around 1,10,000 vehicles. It will close the calendar year with the total sales of 30 per cent from the rural market.

There is massive scope of growth in the Indian rural markets. As per the stats, in India, there are 206 million households among which 70 per cent have their settlement in rural areas. Only 2.3 per cent have cars in the rural areas when compared with the 10 per cent who own cars in the urban areas.

As per the senior executive from Maruti Suzuki India, there is great potential which lies in the rural markets. He also revealed that, the company wishes to increase its rural market share to 20 per cent which is 17 per cent currently. The tie ups with both the rural facility is helping Maruti Suzuki to expand itself in the village arenas.

ITC's e-Choupal for Marurti Suzuki India will provide a platform that would help the customers with the demands at its Choupal Sagars and will also helps in fixing meeting with is clients at the rural level. Harilayali Kissan Bazaar chains aims to offer empowerment to farmers by introducing centres in village areas. There are centers wherein each one of these operates in a 20 kms area and caters to as many as 15,000 farmers.

Hindustan Motors is also getting ready to explore the rural market, the company will soon launch a programme called “rural focus programme” in this year's fourth quarter, as confirmed by, Manoj Jha, Managing Director of Hindustan Motors. He added that, it will raise the sale in the rural sector to 15 per cent from 12 per cent in 2011 fourth Quarter and will further enhance the growth in the coming year. The company's 10 per cent of the total sales in 2010 came from the rural auto sector. The company's 1.5 and 2.0 diesel variants are liked in the rural sector.

Santro, emerged as the market winner for Hyundai Motors India (HMIL). Arvind Saxena, the director of sales and marketing of HMIL, said that, 31 per cent of the sale came from the rural market in 2009 and the company wishes to maintain the same sales graph for the coming year.

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