Automobile companies in India are now eyeing the rural market to improve sales figures. Over 750 million people in the country reside in rural areas, which currently account for 10 per cent of total auto sales. The vehicle density in these areas is a mere 2.3 per cent, and is likely to grow tremendously in the coming years.

Companies like Maruti Suzuki and Hero Honda have been particularly successful in villages because of their early entry into these markets and their efforts to establish their hold over them. That is also partly the reason why these two companies have been the least affected by the economic downturn.

Other small car and two-wheeler companies too are now trying to expand their presence in rural markets. The rural auto market in India is expected to see double-digit growth this year, higher than the industry’s overall expected growth. Maruti Suzuki, which currently gets 10 per cent of its customers from rural areas, expects this figure to go up to 15 per cent this year, while two-wheeler giant Hero Honda is looking at 55 per cent sales in the rural market, up from the current 50 per cent.

Courtesy: www.driveinside.com