Maruti Suzuki plans to focus on India’s rural market to increase its sales and profit margin.
Maruti Suzuki managed to almost double its income during the first quarter and now it plans to boost sales in India’s rural areas, as deliveries in small towns and villages surpassed those in large cities. The Indian automaker will raise its marketing investments to attract more customers in the countryside, also relying on better rural road connections to convince new buyers to purchase the DZire, WagonR and Alto models.
“In villages, customers come with bags of cash and select a car and want it there and then,” Mayank Pareek the company’s sales head. “‘What we’ve done so far is just the tip of the iceberg, and we can really penetrate more and do wonderful work.”
In the fiscal year ended March 31st, sales in the countryside accounted for 28% of the company’s sales, compared with only 4% in 2010, while sales in small towns increased 15% during the same period. Maruti’s net income during the first quarter rose to 12.4 billion rupees ($228 million), compared with 6.4 billion rupees last year, due to a weaker yen, lower components’ prices and increased demand for the Ertiga minivan and revamped Swift DZire.