Maruti on overdrive mode in rural India

NEW DELHI: After establishing its foothold in urban and semi-urban markets, the country's top carmaker Maruti Udyog has embarked on an ambitious penetration drive in villages and entered into an understanding with regional rural banks for car finance to push sales.

The company, which early this year began executing its pan-India plan, has already started seeing the results.

"Already, we have sold 2,700 cars and generated about 20,000 enquiries through the rural scheme which was started in April," MUL Managing Director Jagdish Khattar said.

Interestingly, of the cars sold under the scheme, 50 per cent were Alto while about 23 per cent were M800, he added.

Khattar said one of the main reasons for the company's confidence in doing well in rural areas was its ability to rope in regional rural banks as partners for financing, besides taking help from the company's existing umbrella of car financiers, including Mahindra Finance and Magnum.

"We wrote to 95 regional rural banks, which together have about 14,000 branches all over the country for financing purchases," he said.

Besides approaching the banks, MUL has also been innovating its rural sales strategy by asking dealers to appoint rural sales executives (RSEs) to build and maintain relationship with potential customers.

"Since January, our dealers have started appointing RSEs in villages, who belong to the place and are stationed there itself. The idea is to strengthen interaction with potential customers and convert them to buyers," he said.

Khattar said so far various dealerships of MUL have appointed about 1,500 RSEs and "many more will be added".

These RSEs have been able to talk to a wide range of customers from different walks of life in rural areas, starting from teachers to big farmers who already own other vehicles like tractors, he added.

Taking a step further, MUL has also started involving village panchayats to boost sales by taking part in many of the rural events.

"We have been taking part in a number of rural sports such as kabaddi and other school events to increase our visibility," he added.

Besides, the company has been holding roadshows with about 45 floats (vans on which the company's cars are displayed) across the length and breadth of the country.

Talking about the potential of the rural market, Khattar said: "There are about 21 lakh village panchayats and two lakh pradhans. We are trying to work on the basic human psychology of one buyer influencing the other."

Khattar said MUL's rural scheme has also thrown up employment opportunities for villagers who can learn to drive cars and can migrate to cities where there is a lot of demand for drivers.