For months the Indian automobile industry has been facing fluctuating interest rates which directly affect the car owners who get their car’s financed. This is a matter of concern as owing to the same, the company is experiencing a serious drop in overall sales in the urban markets. So now tackling the issue in a known manner, General Motors (Chevrolet) India’s president Karl Slym said that the company will now focus on the rural markets and will ensure maximum penetration into the same so as to counter the slowdown in the sales.
He said, “In smaller towns, the impact of slowdown is very little as people there don’t rely much on car loans. With good monsoon in the hindsight and good signs this year too, people in rural India are much comfortable,”
Talking in terms of percentage sales from rural and urban markets respectively, he added, “A couple of years back, we would have our 60% per sales from metros and 40% from non metros. But now the figures have been reversed. Now with even deeper penetration in smaller cities, we expect the sales contribution from smaller center to go up to 70%,”
A similar strategy was adopted by Maruti Suzuki a few years back and they succeeded. Recently Hyundai also announced of its rural plans where it plans to expand its sales outlets to 300 and now walking down the same path GM says that it the coming months and before the year end, the company will inaugurate 50 more sales outlets.
All in all there is nothing unique about the strategy but yes a certain amount of growth could always be expected from the rural market which will definitely boost GM India’s sales.
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